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Stop press: Sir Alan Sugar's bought into Woolies

by Rebecca Burn-Callander - Friday, 10th October 2008 - (3) comments

Stop press: Sir Alan Sugar's bought into Woolies

Amstrad founder and Apprentice star Sir Alan Sugar today acquired a four per cent stake in the ailing Woolworths chain.

Despite being worth an estimated £830m, Sugar has joined the ranks of the "bottom-feeders", scooping up shares in the homewares retailer as its share price hit an all-time low.

Here are the facts. Woolworths' share price fell 80 per cent over the past year. It has no property portfolio to speak of (Geoff Mulchacy bagged that when Woolworths was demerged from Kingfisher) and shares in the budget chain closed at 3.14p yesterday. Sugar's bought 57 million shares to make up his 3.88 per cent stake.

What's Suralan playing at?

Woolworths reported pre-tax losses of almost £100m in the first half of 2008. It's in serious trouble. Former CEO Trevor Bish Jones was cut loose earlier in the year to be replaced by the lean, mean Steve Johnson. Johnson plans to ditch 120 stores, cut staff and drop 25 per cent of products.

What does Sir Alan know that we don't? Perhaps he's hoping that the John Lewis set, hit by the credit crunch, will downgrade over Christmas and buy all their friends £2 own-brand vases.

RB is incredulous.

The only positive news on the grapevine is that Woolies has struck a £9m deal with Tesco, offloading a number of its long-term leases. That might suck up some of the chain's £295m debt...

If you were our investment banker, Sir Alan, we'd have two words for you:

"You're fired!"

Picture source

3 Comments

November 29, 2008 11:40am
Tim Bates Says:

Woolworths is the best brandname in the world. it is totally cool. DVD book sales to other supermarkets is going well. After all they have used the business model for woolworths to supply WH smiths, tescos liddl and the like! So what is left to woolies. WElll what about being a place to have coffee and somewhere to eat? Good cafes NEVER FAil. EVeryone likes coffee etc. It is a place where locals can natter .. So this is what Alan should do compete with Starbucks. Ii am sure there are appartment stores that barely make any money but the cafe section keeps it afloat. I love the feeling of department stores but i do not think i would buy anything there - over priced and out of fashion. But i love them. They fell safe and cosey. Woolies needs to be a derpartment store on one floor. Meanwhile natter with me and your own friends at otoop.com !!!

November 27, 2008 2:43pm
Catherine Woods Says:

Hi Hamil,

Er, the spelling is intentional: Suralan is a common way of referring to the big man.

FYI... http://us.ft.com/ftgateway/superpage.ft?news_id=fto032520081625445465

http://www.guardian.co.uk/media/2008/jun/15/television.bbc

PS You're forgiven for the insult.

November 27, 2008 2:27pm
hamel teli Says:

nobs, u spelt sir alan as suralan!

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