By Kymberly Martin
Despite being rejected as a contender.
The prospect of JB Hi-Fi as a bigger competitor does not concern Harvey Norman chairman, Gerry Harvey.
Harvey was responding to the decision by the Australian Competition and Consumer Commission (ACCC) not to oppose the proposed acquisition of The Good Guys by JB Hi-Fi.
“Quite frankly it does not worry me at all,” Harvey told Appliance Retailer. “Why would I care if it is under one owner or two owners?
“As far as I am concerned I am quite happy for JB Hi-Fi to purchase The Good Guys and I have no issue with it whatsoever. However, my other directors here have a different opinion to me so if it came to a vote on our board on that one I would lose.
“Initially we asked for the opportunity to see their accounts but that was rejected by The Good Guys who obviously did not want us to even consider a purchase. We would have looked at it but it is a private company and they decided they did not want anything to do with Harvey Norman. So it all came to a dead end.”
The ACCC announcement was based on feedback and other industry information that concluded that JB Hi-Fi and The Good Guys focused on different categories and customers. The ACCC also found that post-acquisition, customers would have a range of alternative retailers of home appliances and consumer electronics.
According to ACCC chairman Rod Sims, JB Hi-Fi has traditionally focused on selling consumer electronics, with stores located mostly in shopping centres or CBDs. “On the other hand, The Good Guys has mostly focused on whitegoods and other home appliances, with stores generally located in home centres or similar locations. Other retailers such as Harvey Norman have a much higher degree of overlap with The Good Guys than JB Hi-Fi,” Sims said.
Shares in JB Hi-Fi rose by more than 5% following the ACCC announcement.
Harvey Norman sales on a high
Harvey said retail sales are strong “everything is selling at the moment right across the board and we will finish with one of the best results we ever had and I am hoping this year is going to be even better. Sales from our international stores paint a pretty good picture too and it is shaping up to be one of the best years for us globally.
New Zealand, Asia and Slovenia are all going well and improving which bodes well for next year. This is good news for us as there have been weaknesses in some of our overseas markets.”
Harvey Norman will release its sales results later this month.