Wesfarmers Ltd said the Supreme Court of Western Australia has given it a nod to hold a shareholder meeting to vote on a planned spin-off of its supermarket chain Coles.
If the spin-off is approved, Wesfarmers will retain a 15 percent stake in Coles and half of the supermarket chain’s loyalty card program, Flybuys, the conglomerate said on Friday. It expects to hold the shareholder meeting on Nov 15.
Wesfarmers had announced in March its plans to spin off Coles and list the business on the Australian Securities Exchange (ASX) as part of a major portfolio overhaul.
Analysts estimate Coles to be worth about A$16 billion ($11 billion). The demerger is expected to be completed in November, with Coles shares expected to debut on Nov. 21.
Wesfarmers’ dividend policy will remain unchanged following the demerger, the company said.
In a separate release, the conglomerate also said it had signed an agreement to automate Coles’ supply chain over a five-year period.
Coles expects to book before-tax charges between A$130 million to A$150 million in their 2019 fiscal year, related to redundancies and other costs during the period.
The demerger booklet, which is expected to contain more details on the separation of Coles, will be lodged with the ASX later on Friday, the company added.
Wesfarmers shares, which were halted prior to the announcement, edged up 0.5 percent as trading resumed.
Source: Reuters.com