Jan Cameron makes her move on Kathmandu

Jan Cameron has made her first move, after a restraint of trade was lifted on May 2, to compete directly with the company she sold in 2006 Kathmandu Ltd [KMD.NZX].

It has been reported that she has invested an initial 20 million into kiwi outdoor clothing chain, Macpac to go head to head with KMD in Australasia and presumably in other markets KMD trades in. She is one smart cookie whose business acumen in retailing should never be underestimated by her competitors and she has strong contacts in retail and retail suppliers in this part of the world and elsewhere and her expertise in the outdoor retail sector cannot be underestimated.



Cameron has several individuals within Macpac that are former associates at Kathmandu and they have an aggressive expansion plan in place to take on KMD.



While Macpac currently has fewer branded stores than Kathmandu's 100, with only 29 in Australasia, Macpac's products are stocked in over 100 retail outlets worldwide so have a broader brand recognition if a global business is what management are looking at in the long term.

Kathmandu as a strong in your face brand have the outdoor sector mostly to themselves in New Zealand and Cameron's expertise and contacts in retail will be a formidable challenge to Kathmandu and its impressive retail margins that they have placed their whole business model and recent IPO on.

Management at KMD will be seriously worried about this and as Macpac gets a larger retail footprint across this part of the world revenue and profits will be cut.

Make no mistake it will be cutthroat between these two brands and the winner will be the consumer in the end.

It remains to be seen which retailer will come off the big winner but my money is on Jan.


Jan Cameron @ Share Investor

Jan Cameron ready to move on Postie Plus Group?
Kathmandu's 2011 Results Under Pressure from Jan Cameron
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Kathmandu @ Share Investor

Share Price Alert: Kathmandu Holdings Ltd
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Kathmandu Holdings Ltd: 2010 full year profit analysis
Chart of the Day: Kathmandu Holdings Ltd
Kathmandu Holdings: Market Update Misleads
Kathmandu's 2011 Results Under Pressure from Jan Cameron
Kathmandu IPO: Prospectus Analysis
Kathmandu IPO: Jan Cameron lands a blow to IPO
Kathmandu IPO: What is it worth?
Kathmandu IPO: Retail Interest HighKathmandu IPO: A tough mountain to climb
Kathmandu No.1 but IPO should get the Bullet
Download the detailed Kathmandu Value Cruncher Report - Requires free registration at Share Investor Forum to download
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Discuss Kathmandu @ Share Investor Forum



c Share Investor 2011

Jan Cameron ready to move on Postie Plus Group?

Not totally sure what her end game is but Jan Cameron, ex Kathmandu Ltd [KMD.NZ] and retailer with several different brands selling goods to the public, along with nearly 10% of Pumpkin Patch Ltd [PPL.NZ] has just topped up her holding in Postie Plus Group Ltd [PPG.NZ].

On Monday 5 July she bought 600,000 shares to take her holding in PPG to 19.26% or 7,702,537 shares. She previously held 17.76%.

Under the Takeovers Code the owner of 20% or more of shares in a company must make a bid for 51% of that company.



With 32,297,463 shares held by family associated with PPG and various smaller shareholders like myself and larger holders like ACC, Jan would only have to purchase a further 12,697,463 shares to make a play for a 51% holding. Just over $3.8 million.

The market capitalisation of PPG is just $12 million.

What are Jan's intentions though?

Well, one can only do some fancy guesswork on this so lets have a go.

Jan has had a holding in PPG for many years and just two years ago snapped up their distressed manchester brand Arbuckles and used some of the 23 store sites to install her own businesses.

Postie Plus runs three brands. Baby City, Postie and Schoolltex. Baby City being the most successful of the three. Overall though the company hasn't turned a profit for the last 3 years and its recent result, the half year to 31 Jan 2010 is another significant loss. Management have performed poorly over the entire 7 year listing of the company and any redemption from PPG shareholders would surely lay in how much they could get if they sold the company to a better operator.

What I think Jan is doing is buying up and waiting until the company gets in such a state the remaining shareholders will be more than willing to sell.

Jan will have to pay more than the 30c per share she paid on Monday because none of the family interests will want to have a complete fire sale but lets just say that they would probably be open to offers.

The sites that PPG currently operate their brands in would be perfect for her new outdoor goods venture or another of her many retail interests in New Zealand.

Whatever she does do with her PPG holding you can be sure it will fit into her larger retailing empire.

Disc - I own PPG shares in the Share Investor Portfolio



Postie Plus Group @ Share Investor

Long Term View: Postie Plus Group Ltd
I'm Buying: Redux
What is Jan Cameron up to?
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Jan Cameron @ Share Investor

Kathmandu's 2011 Results Under Pressure from Jan Cameron
Kathmandu IPO: Jan Cameron lands a blow to IPO
What is Jan Cameron up to?

Discuss PPG @ Share Investor Forum

Download PPG Company Reports




c Share Investor 2010

Kathmandu's 2011 Results Under Pressure from Jan Cameron

I have given Kathmandu Holdings Ltd [KMD.NZ] alot of criticism since its IPO and float back in November 2009 and its result 2010 interim result out in March doesn't really change much for me.

Its results for this period are largely academic because they cannot be accurately compared to last years figures with were calculated using pro-forma figures. Pro-forma accounting is calculated by removing "irregular" business transactions and smoothing out the balance sheet to make things look better to investors - a great way to hide bad news. Pro-forma is generally accepted as misleading.

The increases in revenue and profit for the 2010 half year look spectacular at first glance but the comparison to last year means little as I have outlined above and the headline figures of the NZX release omit significant IPO costs - $21.3 million, $6.3 million more than budgeted. The profit result then is a $13.3 million dollar loss not an $8 million profit.

Of particular interest to shareholders should be the figure tucked away in the 2010 Interim Report of the net tangible asset backing per share. It is 12c.

A better comparison on how well Kathmandu is going will be able to be made this time next year when we can accurately compare like for like figures (we still have to add the IPO costs to get a good comparison) and then perhaps I will stop my criticism if it is a good result.

Of further concern to Kathmandu shareholders will be the possible re-entry of the former owner of the Company, Jan Cameron, back into the same retail sector sometime in 2011.

She is currently in talks with Macpac, an outdoor equipment and clothing retailer, to establish some kind of competition against the former brand that she built up and as I have said before she is one smart cookie whose business acumen in retailing should never be underestimated by her competitors.

Kathmandu as a strong in your face brand have the outdoor sector mostly to themselves in New Zealand and Cameron's expertise and contacts in retail will be a formidable challenge to Kathmandu if she decides to make a move back into this area of retailing.

Kathmandu shares have traded as high as NZ$2.56 earlier in 2010 but finished trading last Friday at $1.90.

Kathmandu @ Share Investor

Kathmandu IPO: Prospectus Analysis
Kathmandu IPO: Jan Cameron lands a blow to IPO
Kathmandu IPO: What is it worth?
Kathmandu IPO: Retail Interest High
Kathmandu IPO: A tough mountain to climb
Kathmandu No.1 but IPO should get the Bullet
Download the detailed Kathmandu Value Cruncher Report - Requires free registration at Share Investor Forum to download
Download Kathmandu IPO Prospectus
KMD Investor Presentation to Macquarie

Discuss Kathmandu @ Share Investor Forum

Download KMD Company Reports


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c Share Investor 2010

Kathmandu IPO: Jan Cameron lands a blow to IPO

I have been covering the Kathmandu IPO over the last few weeks and am working on the prospectus in between changing nappies and trying to get some sleep.

News out today that Jan Cameron, former owner of Kathmandu, will set up her own outdoor clothing chain in New Zealand and Australia is clearly bad news for the IPO:

Now she has revealed she is well advanced in plans to set up an outdoor clothing business of 60 stores - 30 in New Zealand and 30 in Australia - to compete with Kathmandu next year. She said she was earmarking A$27 million for the venture.

She was even dismissive of the Kathmandu model of regular 50 per cent off sales.

"I imagine that if we are offering a similar product at competitive prices, at everyday low prices, around 50 to 60 per cent lower than Kathmandu, I imagine that might be quite attractive," she said. "I really love the product and the industry and I see an opportunity with a different model.'' More at Stuff.co.nz

Cameron is an individual not to be underestimated when it comes to competition. She has made a career out of buying cheap assets and making money from them and her retail prowess when it comes to starting a business is almost unparalleled.

She recently bought up large stakes in Pumpkin Patch Ltd [PPL.NZ] Postie Plus Group [PPG.NZ] and purchased cheap retail sites in Australia abandoned by The Warehouse Group [WHS.NZ] a few years ago and set up a cut price chain.

Her move back into outdoor retailing will affect the value of the Kathmandu IPO to investors because of the direct competition with her old company.

All the figures contained in the prospectus, on which the value of the company is based, are now largely academic due to the new entrant and prospective investors will now have to reassess their position as they contemplate writing out their IPO cheques.

Disclosure: I own PPL and PPG shares.


Related Share Investor Reading

What is Jan Cameron up to?

Kathmandu @ Share Investor

Kathmandu IPO: What is it worth?
Kathmandu IPO: Retail Interest High
Kathmandu IPO: A tough mountain to climb
Kathmandu No.1 but IPO should get the Bullet
Download the detailed Kathmandu Value Cruncher Report - Requires free registration Share Investor Forum to download
Download Kathmandu IPO Prospectus

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c Share Investor 2009

Kathmandu IPO: A tough Mountain to Climb

Buy a good company for top dollar a few years back, load it up with debt and try to flog it off in an IPO when the market the company operates in is crashing faster than a cheap hooker can get her knickers off, is your next thought where can I sign up?

There has been talk about an IPO for the outdoor retail chain Kathmandu over the last few days and various figures have been thrown around, including one reported in Stuff.co.nz from the Australian Financial Review (where this rumour was first reported) that puts the asking price at between $NZ 500-600 million dollars.

Considering that the company was sold off by founder Jan Cameron and other partners in 2006 for just over $NZ $500 million at the peak of its then earning power, in a retail market that was on fire, the rumoured asking price is way over the top especially when one considers these key points:

1. The dire condition of retail worldwide

2. Debt levels of $187 million VS assets of $331 million to July 2008

3. Profit down from $13.7 million to just under $9 million to July 2008

4. Interest costs for the year to July were $20.9 million, up from $18.2 million the year before.

5. A retail scene that is unlikely to recover soon.

These figures are a full year old and come before the massive decline in retail worldwide so we could assume that the company is now on the bones of its arse profit wise, with even more debt and almost twice the overheads the company had back in 2006 because store numbers have almost doubled.

One big drawback is that the company possibly selling Kathmandu, Goldman Sachs and Quadrant Private Equity, is missing one vital key to the retailer's success, Jan Cameron herself.

Jan got out of her company at the right time, for a great price and has used the proceeds of that sale to buy beaten down retail stocks like Pumpkin Patch Ltd [PPL.NZ], Postie Plus Group [PPG.NZ] and kick off a number of brand new start up retailers like her Nood Homewares business and Dog's Breakfast.

A good exit by Jan, and a bad possible re-entry by Kathmandu.

To be avoided.

Disclosure: I own PPG, PPL shares


Related Share Investor Reading

What is Jan Cameron up to?

Kathmandu @ Share Investor

Kathmandu IPO: What is it worth?
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c Share Investor 2009

The Headliner: 2 April 2009 Edition

Subscribe to The Headliner @ Headliner.co.nz

Direct from my Mysterious Benefactor comes another edition of one of New Zealand's leading finance papers, The Headliner.

This April 2 edition has a major story on Sky Television [SKT.NZ] and its coming battle with Tivo.

It also covers something I have missed, a foray by Jan Cameron to buy more shares in Postie Plus Group [PPG.NZ] She now owns a whopping 17.75% for a very low total price.

It also skips over retailers Hallenstein Glasson [HLG.NZ] and Briscoe Group [BGR.NZ] with a look at results and future prospects.

Pike River Coal, GPG and Cavalier are also given the once over.

The Headliner has an interesting Portfolio picks section. Here are this edition's picks:

Pike River Coal [PRC.NZ]

Lyttleton Port [LPC.NZ]

Northland Port [NTH.NZ]

F & P Appliances [FPA.NZ]

Just Water [JWI.NZ]

Nothing I would have chosen except perhaps Fisher & Paykel Appliances and only below 20c.

To my mysterious benefactor thank you and please keep them coming.

Disclosure: I own PPG, BGR, & HLG


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c Share Investor 2009

Pumpkin Patch ripe for the picking

Recent purchases of beaten down Pumpkin Patch Ltd [PPL.NZ] stock by Jan Cameron, the former owner of the Kathmandu Ltd [KMD.NZ] outdoor chain and Rod Duke, the majority owner of retailer Briscoe Group have got me to the point of more than idle speculation.

At the risk of getting the borax poked at myself, here goes.

If an individual is going to make a takeover play for an asset of any class, when is the best time to buy?

When nobody else is interested and when the asset is selling below its usual market price or true value.

I would argue that the little Pumpkin is well undervalued, to the extent that I bought some more recently at NZ$1.53.

Its potential is huge and its value lies in its so far proven record and its very strong brand and the ability to exploit that brand for growth and customer loyalty.

In the good times last year the schizo "Mr Market" valued the company at almost 5 bucks per share but as of today the share price is below $1.50.

Cameron and Duke both recently bought the bulk of their holdings at around the $1.50 mark. Duke holds almost 10% and Cameron just over 6%.

At today's share price the approx 166 million shares in PPL could be purchased for around $250 million dollars. A very high premium would be needed for a full bid because many investors have bought shares at well above $1.50 and Maurice Prendergast, the CEO and Sally Synnott, the founder together own 20 million shares and they have a long term view of their company.

But everyone has their price.

Both Duke and Jan Cameron certainly have the means to be able to afford such a purchase.Duke, supposedly worth a minimum of NZ$254 million and Cameron thought to be worth around $300 million.

Given this recent flurry of buying activity by both these high profile retail identities and the current low share price of Pumpkin Patch, if the company was going to be a target for a takeover, now is the most likely time for that to happen.





Disclosure I own PPL shares in the Share Investor Portfolio.


Pumpkin Patch @ Share Investor

Pumpkin Patch Ltd move downmarket
Long Term View: Pumpkin Patch Ltd
Pumpkin Patch's North American Downsizing a Prudent move
Digging at Pumpkin's Profit
Long vs Short: Pumpkin Patch Ltd
Pumpkin Patch Buyback shows Confidence in the Future
Pumpkin Patch takes a hit
Pumpkin Patch ripe for the picking
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I'm buying
Why did you buy that Stock? [Pumpkin Patch]
Rod Duke's Pumpkin Patch gets bigger
Buyer of large piece of Pumpkin Patch a mystery
Pumpkin Patch a screaming buy
Broker downgrades of PPL lack long term vision
Pumpkin's expansion comes at a cost
Pumpkin Patch vs Burger Fuel
Pumpkin Patch profits flatten
New Zealand Retailers ring up costs not tills

Discuss PPL @ Share Investor Forum

Download PPL Company Reports

Buy Pumpkin Patch Clothing

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c Share Investor 2008

What is Jan Cameron up to? (UPDATE 4)

What is Jan Cameron up to?

(PPG share purchase update) On Monday 5 July 2010 she bought 600,000 shares to take her holding in PPG to 19.26% or 7,702,537 shares. She previously held 17.76%.

Cameron, who sold a 51 % stake in her Kathmandu outdoor clothing company for NZ$275 million in 2006, would now own over 7 million shares in PPG for a sum of less than $5 million.

The 19.26% of PPG Cameron now owns is not far short of the 20% takeover threshold where if she wanted more of the company she would have to make an offer to all shareholders for their holdings.

Like her competitor in retailing, Rod Duke, who has recently built up a stake in Pumpkin Patch Ltd [PPL.NZ] she could be just taking advantage of beaten down stock prices, with a small non controlling stake in Postie Plus or building up a holding for a possible takeover. This doesn't seem likely though.

Jan likes control in her business life so it would be natural to assume that she could see herself as an outright owner of Postie Plus.

At current share prices, in theory at least, she wouldn't have to pay more than $14 million for the remaining 32 million shares in the company. Of course a premium would have to be paid for full control but either way she could probably grab the entire company for less than $20 million.

There is no doubt that Cameron is a canny business woman. She built Kathmandu from a small one store retailer in Melbourne in 1987 to a medium sized outdoor "lifestyle" chain with 46 stores, in Australia, New Zealand and Great Britain.

Given her successful past there must be something that she sees in Posties Plus that makes its future better than it is currently.

Postie Plus has three different brands in its store stable. Postie Plus, Arbuckles and Baby City.

Out of these, Postie Plus is doing satisfactorily, Baby City are doing very well and Arbuckles, the manchester business was sold to Cameron in its entirety on June 10.

I could see how Cameron might be interested in Baby City as a brand to grow. This brand, specializing in baby clothing and accessories, is operating in a sector ripe for more branded chain store competition. Baby City really has only one serious branded competitor in New Zealand in Pumpkin Patch. With a little of Cameron's retailing magic Baby City could be a good place for her to start a much larger brand, although recent revelations that Cameron has bought a 6.3% stake in the Pumpkin might give that sort of speculation a lively twist.

The Postie Plus brand is a chain that has recently undergone a bit of a revamp. From selling conservative clothing to older people, especially women, it has now gone slightly more upmarket with a broader range of goods for a larger customer base. It is still struggling in the current economic downturn but with Cameron's retailing expertise and well known focus on minimising cost it could well do better under her guidance.

It is great to see one of New Zealand's more successful business women take an interest in a company with a beaten down capital value.

She likes to take control of her business interests (who doesn't) and is a very aggressive player.

She currently has a number of different retailing interests. A new one, Nood, a home wares store, is going head to head with Briscoe Group [BGR.NZ] Urban Loft stores. Like most New Zealand retailers, Briscoes is struggling at present.

With Cameron's track record and stake in Postie Plus it will be curious to see what her next move might be.

In October 2009 that question has been answered in that Jan has made a move against her former company Kathmandu, who is currently perusing and IPO, by making public her plans to go into competition with them in the outdoor clothing market.





Jan Cameron @ Share Investor

Jan Cameron ready to move on Postie Plus Group?
Kathmandu's 2011 Results Under Pressure from Jan Cameron
Kathmandu IPO: Jan Cameron lands a blow to IPO
What is Jan Cameron up to?


Kathmandu @ Share Investor

Kathmandu IPO: Prospectus Analysis
Kathmandu IPO: Jan Cameron lands a blow to IPO
Kathmandu IPO: What is it worth?
Kathmandu IPO: Retail Interest HighKathmandu IPO: A tough mountain to climb
Kathmandu No.1 but IPO should get the Bullet
Download the detailed Kathmandu Value Cruncher Report - Requires free registration at Share Investor Forum to download
Download Kathmandu IPO Prospectus

Discuss Kathmandu at Share Investor Forum









c Share Investor 2008

Buyer of large piece Pumpkin Patch a mystery

A sizable chunk of Pumpkin Patch
was traded today, leading to speculation
as to who the purchaser might be and why.


Like other global markets New Zealand's NZX rallied today(19 March NZ time) by 1.4%.

Not as spectacular as the Dow's 400 plus points or Asian markets 3% plus rises but many of our stocks did well.

There are more months of bad news to come so don't forget what happened earlier this week please.

I must point out to readers of Share Investor that I noticed a stock that finally got bought in serious volumes today after being beaten down to its IPO price earlier this week.

Pumpkin Patch Ltd [PPL.NZ], the children's clothing retailer and manufacturer, hit $NZ1.5o yesterday and one or several sizable players got some serious action in the company to the tune of over 6.7 million shares. A very large daily amount for this company and the current thin liquidity of trading in NZX stocks in general at present.

Who the buyer was can only be speculation at present but there are several I'm willing have a stab at.

My first pick would be Carmel Fisher's Fisher Funds, who already have a sizable chunk north of 5% of the company and would clearly see the company as a steal considering the current price and the price they paid for the bulk of their chunk in the company.

A close second horse would be Jan Cameron, the former owner of the high fallootin outdoor lifestyle retailer Kathmandu and a recent large purchaser of shares in Postie Plus Group(PPG), another more "down market" New Zealand retailer.

Pumpkin Patch, like Kathmandu, is a strong, high margin, brand in its market/s and it would fit her investing profile for good companies bought at excellent prices.

Of course another outside guess would be an as yet unknown player getting a foothold in the company to launch some sort of bid for the retailer. I hope not.

3.6% of the company's shares were traded and the buyer got their stake at NZ$1.60.

The shares were up by 11c to $1.61.


Disclosure I own PPL shares in the Share Investor Portfolio.


Pumpkin Patch @ Share Investor

Pumpkin Patch Ltd move downmarket
Long Term View: Pumpkin Patch Ltd
Pumpkin Patch's North American Downsizing a Prudent move
Digging at Pumpkin's Profit
Long vs Short: Pumpkin Patch Ltd
Pumpkin Patch Buyback shows Confidence in the Future
Pumpkin Patch takes a hit
Pumpkin Patch ripe for the picking
What is Jan Cameron up to?
I'm buying
Why did you buy that Stock? [Pumpkin Patch]
Rod Duke's Pumpkin Patch gets bigger
Buyer of large piece of Pumpkin Patch a mystery
Pumpkin Patch a screaming buy
Broker downgrades of PPL lack long term vision
Pumpkin's expansion comes at a cost
Pumpkin Patch vs Burger Fuel
Pumpkin Patch profits flatten
New Zealand Retailers ring up costs not tills

Discuss PPL @ Share Investor Forum

Download PPL Company Reports

Buy Pumpkin Patch Clothing

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Buy Bird on a Wire: The Inside Story from a Straight Talking CEO & more @ Fishpond.co.nz




c Share Investor 2008