In some of the most closely watched news on the market his morning, supermarket giant Woolworths (ASX:WOW) has confirmed it will sell off a stake in Endeavour (ASX:EDV).
Endeavour operates BWS and Dan Murphy’s bottleshops around the country within its portfolio of hospitality venues.
The company also operates popular alcohol delivery app Jimmy Brings, ALH Hotels, and a number of upmarket winery operations.
Shares in the company had fallen -4.5% to $5.12/sh in the first hour of trade on Wednesday.
Woolworths, meanwhile, was up 0.20% to $31.96.sh.
So what’s the rationale?
“Woolworths Group and Endeavour Group remain important business partners, with a number of long term partnership agreements in place,” outgoing Woolworths CEO Brad Banducci said.
“[But] we no longer believe that a material equity investment in Endeavour Group is required as Endeavour Group approaches its three-year anniversary as an independent listed company.”
As a result, the company triggered a block trade for proceeds of $468M, selling off all its units in EDV at $5.22/sh.
Woolworths’ leftover stake is 4.1% and the company says it’s gonna keep holding onto that – it also insists there’s nothing it knows about EDV that the average punter doesn’t.
Curiously, the move does follow record low retail sales growth in Australia clocked by the ABS on Tuesday.
EDV shares last traded at $5.12/sh.