Myer, Australia’s biggest department store, is joining the rush of retailers to the Middle East.
The company said Monday that it’s planning five stores in Dubai and Abu Dhabi in the United Arab Emirates during the next five years. The first Middle East Myer flagship is to open in Dubai’s new IBN Battuta Mall late next year or early 2010. It is a joint venture with Nakheel Retail, the retail property arm of the Dubai World group of companies.
The other four stores also are to roll out in Dubai and Abu Dhabi, with more expansion on the agenda, Myer chief executive officer Bernie Brookes said.
The deal is to be completed by early September, with a complete international strategy announcement to be timed with the release of Myer’s full-year results in September.
“Three of the 10 largest shopping malls in the world are in Dubai, and retail is expected to surge by 12 percent through 2011 in the UAE, but at an even faster rate in Dubai,” Brookes said. “We are then looking at further store expansion, both within Dubai and beyond into the broader Gulf region, the Middle East and even Eastern Europe.”
A separate Myer management team will be established in the region.
The size of the Middle East stores is uncertain. The retailer’s Australian units range from 108,000 square feet to more than 861,000 square feet.
“It’s hard to say [the size] at the moment — they’re looking at the sites,” said corporate affairs manager Mitch Catlin.
Myer will be branded and marketed as an Australian department store, he said. The product mix will include some local merchandise and also will have more focus on children’s wear and furniture, commensurate with consumer trends in the region that have been identified by Myer’s research.
Fashion will be a major focus, and Myer believes that a market gap could be tapped by Australian brands. The company is in discussion with all its major suppliers — some of which already might be selling to multibrand retailers in the region, such as Villa Moda.
Myer’s fashion stable includes some of the best-known Australian brands, including Josh Goot, Leona Edmiston, Yeojin Bae, camilla & marc, Jayson Brunsdon, Toni Maticevski, Nevenka, Charlie Brown and New Zealand’s Karen Walker.
The UAE joint venture is the latest strategy of Myer’s new owner, Texas Pacific Group’s Asia Pacific investment arm, Newbridge Capital, since a consortium led by TPG and Newbridge Capital acquired the 61-unit chain from Coles Myer in June 2006 for almost $1.4 billion.
In March 2007 — in the same month that the company reported an 84 percent surge in half-year earnings before interest and taxes to about $120 million — Myer announced it would roll out a dozen new stores in three years, to take the chain to 75 units and almost $4 billion in sales.
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