JB Hi-Fi to buy rival electronics and whitegoods retailer The Good Guys for $870 million.
The company announced about the deal today morning, saying that it would generate new opportunities for each brand in order to increase store numbers and market share.
Under this deal, The Good Guys company will continue to operate as an individual brand and will retain its chief executive Michael Ford. He will be reporting to JB Hi-Fi’s boss Richard Murray.
Both companies said that they were strong enough with complimentary customer bases and product offerings.
JB Hi-Fi stated that this deal would strengthen the group’s share of the $4.6 billion home appliances market. It is a more lucrative category that has ventured into over the past 3 years with the breakthrough of its JB Hi-Fi Home stores.
“The acquisition is a very attractive strategic opportunity for JB Hi-Fi since The Good Guys is a highly complementary business which is aligned with our management philosophy and significantly enhances our offering in the $4.6 billion home appliance market,” JB Hi-Fi chief executive Richard Murray said.
The Good Guys company has access to wide range of home electronics. Traditionally, it has concentrated on whitegoods while selling home electronic items on the side.
JB Hi-Fi also has plans introduce new The Good Guys branded stores in “under represented catchment areas”. This could see heavy competition in the home goods space heat up which, inturn mean big savings to consumers.
Michael Ford, The Good Guys chief executive will continue to run under JB Hi-Fi’s ownership. And this agreement is expected to be completed by this year or early next year.