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Myer looks for new investors in its fight to neutralise Lew

Last week he publicly called on the Myer board to release profit guidance for the financial year just passed, saying that potential directors needed some understanding of the department store group’s financial shape before agreeing to join the board.

Myer is in desperate need of a share price re-rating to convince its investors that it has a plan to retrieve its performance.

Myer is in desperate need of a share price re-rating to convince its investors that it has a plan to retrieve its performance.Credit:Peter Rae

To date. Myer has provided no clarity on how it traded in the six months to July 2021 and there is a yawning gap between the $172 million it lost in the previous financial year and the market consensus of a $33.5 million profit for the 2021 financial year.

Myer is in desperate need of a share price re-rating to convince its investors that it has a plan to retrieve its performance. Without this, Lew’s pitch that he is Myer’s best chance of being saved will resonate among those that have witnessed the company’s earnings and share price deteriorate for years.

Interestingly Myer has enlisted the corporate advisory services of Ron Malek and Simon Mordant’s Luminis Partners.

This duo has gone into battle with Lew previously, having mounted the defence against Premier hostile bid for Just Group.

But this time around Malek, who is taking the lead, is not fending off a takeover offer but is defending a company with a poor record. He will understandably be running a line that Lew’s attempts to jettison the board is tantamount to getting control of Myer without a takeover.

Myer has plenty of modern day governance arguments in its favour. But Lew has Myer’s poor performance in his corner.

Over the past 11 years Myer shares have fallen more than 86 per cent. Last year its chairman Garry Hounsell quit after a prolonged attack from Lew and has not yet found a permanent replacement.

Lew carries a lot of sway in the retail sector and has a track record of publicly campaigning against those that impede his plans.

He has been battling with Myer for three years and history shows that Lew plays a long game.

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