Lowe's will drop joint-venture business in Australia
MOORESVILLE, N.C. (AP) - Lowe's says it's getting out of a joint venture that runs more than 60 home-improvement stores in Australia.
The chain says it has invested about $930 million in the venture and expects to take a non-cash charge against earnings in its fourth quarter, which ends Jan. 29.
Lowe's Cos. Inc. said Monday that it notified Woolworths Ltd. of its plan to end its one-third stake in a joint venture that operates Masters Home Improvement stores and Home Timber and Hardware Group's retail stores and wholesale distribution business.
Richard D. Maltsbarger, president of Lowe's international division, said the company would focus on areas where it sees more potential for return on investment.
Lowe's said there is a process in the 2009 agreement for determining the price of Lowe's stake based on fair market value on Jan. 15, when notice was given.
In the 12 months that ended last June 28, the venture's revenue was $1.6 billion, Lowe's said.
The North Carolina company has more than 1,8445 stores in the U.S., Canada and Mexico. At Friday's closing price of $68.99, the shares have lost 9 percent this year, compared with an 8 percent decline in the Standard & Poor's 500 index.