Shareholders in Woolworths (ASX:WOW) won’t be getting another special dividend next February to go with the 40 cents a share revealed in last week’s financial report after the retailer sold its last stake of 4.1% in grog group, Endeavour on Friday night.
The $383 million block trade was handled by Goldman Sachs on and means the retailer no longer has any link to the owner of Dan Murphy’s and BWS bottle shops, as well as thousands of poker machines in hundreds of hotels.
Woolies said the money from this sale will instead be used to fund the purchase of the remaining 35% of PDF, the foot services group 65% owned by Woolies.
There was a brief mention of this purchase in the annual results filing last wee, but no details about the price.
Woolies bought 65% of PDF back in 2021 for around $552 million. Woolies didn’t give an actual price for the 35% buy on Monday, it just said the proceeds from the Endeavour sale would ‘be used to fund’ the purchase of the 35% shareholding.
If all the proceeds from the latest Endeavour sale are used to pay for the remaining 35% it means PDF’s total value is more than $900 million!
Thanks to the sale in may of a 5% stake in Endeavour, Woolies shareholders found out last Wednesday that they will get a special 40 cents a share one off reward, on top of the final of 57 cents a share which was down a cent from last year.
The final was short of market forecasts for a huge 77 cents a share but no one factored in the special payment which took the total for the 2023-24 year to $1.44 a share from $1.04 a year ago.
Woolies said at the time of the May sale of the 5% stake in Endeavour group that shareholders could expect a capital management move. The special dividend will absorb $489 million, including $209 million in franking credits. It will be, in effect, a Christmas bonus for Woolies shareholders.
