The owner of Smiggle, Peter Alexander and Jay Jays has decided to delay a demerger of Smiggle to focus its attention on a potential sale of some of its brands to Myer.
Myer revealed its intention to acquire clothing brands Just Jeans, Jay Jays, Portmans, Jacqui E and Dotti from Premier Investments' Apparel Brands in June.
If the deal goes through, Myer will take full ownership of the labels in exchange for new Myer shares for Premier shareholders.
The sale of Smiggle, which was expected to be finalised by January, will be delayed until the deal with Myer has been fully decided.
The billionaire 42 per cent owner and chair of Premier Investments, Solomon Lew, said a strategic review of the company highlighted future opportunities for apparel brands that needed prioritising.
"In June 2024, the Premier board determined that the proposed combination of the Apparel Brands business with Myer warrants further consideration, and work has diligently taken place to analyse this proposal," he said.
"The board’s focus in assessing the proposal or any strategic review outcome will also be on creating shareholder value whilst maintaining the potential and integrity of each of the businesses.”
The announcement of the delayed Smiggle demerger comes after a number of key executives of the stationary brand departed within a short time.
Just Group, owned by Premier Investments, alleged in a statement that Smiggle managing director John Cheston was sacked earlier in September for "serious misconduct and a serious breach of his employment terms".
On Wednesday, results from Premier Retail's 2023/24 financial year showed group sales had fallen 2.9 per cent to $1.6 billion with a statutory net profit after tax of $257 million - down 4.9 per cent from the previous year.
Mr Lew blamed the losses on a "tough environment" for retail stores but praised the group's earnings before interest and tax (EBIT), as well as the positive results of Peter Alexander, which surpassed half a billion dollars in sales for the 2023/24 financial year.
“In this challenging retail environment, our FY24 EBIT result of $325.9 million reflects our team’s ongoing focus on inventory productivity and operational efficiencies," he said.
On Wednesday afternoon, the value of Premier Investments had fallen 11 per cent to less than $30 per share.
Earlier, shareholders were paid a fully franked dividend of 70 cents per share that took the full year of dividends to $1.33 per share.
