Kirks to buy neighbour for $29M

By Phil Boeyen, ShareChat Business News Editor

Thursday 13th December 2001

Wellington retailer Kirkcaldie & Stains (NZSE: KRK) is planning a rights issue to help buy the building next door for $29 million.

Kirks says it has entered into a conditional contract for the Harbour City Centre on Wellington's main shopping precinct, Lambton Quay.

The department store company has already laid down a $500,000 deposit for the site with a further $500,000 due next Friday, December 21.

"The purchase is proposed to be funded in part by bank debt and in part by a 1:2 underwritten rights issue at $3.50 per share to raise $8.75 million," Kirks says.

"Assuming all the conditions set out below are satisfied, settlement will occur on the later of 29 March 2002, or the day which is four weeks from the date the purchase agreement becomes unconditional.

The purchase agreement is subject to various conditions including obtaining finance and agreeing an underwriting arrangement.

Shareholder approval is also required before February 21 next year and an extraordinary meeting is expected on February 7, immediately after the AGM, with the rights issue to open the following week.

Kirkcaldie & Stains is Wellington's top department store with annual sales around $35 million.

The Harbour City Centre was redeveloped in the 1980s with a leading mix of fashion retailers although the site has lost some of its sheen in recent years to newer developments, such as the historic revamped BNZ building a few blocks away.

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