Woolies shares fell by around 11% on the first trading day without the Endeavour Group drinks business – in reality the huge Dan Murphy’s grog business, BWS and hotels – on its books.
The shares were down by as much as 15% from Wednesday’s closing price of $42.51, before closing at $37.75, down 11.2%. That was an $8.1 billion reduction in the company’s market capitalisation.
Endeavour shares are trading on a deferred settlement basis until July 1, when regular trading will begin. Endeavour is expected to have a market capitalisation of between $11 billion and $16 billion, which would make it one of the market’s 50 biggest companies.
Woolworths retains a 14.6% stake in Endeavour which it will no doubt sell into the market in coming months just as Wesfarmers sold its 15% stake in Coles after its spin-off.
