Myer to Sell A$221 Million New Shares Amid 70% Profit Slump

Myer Holdings Ltd., Australia’s largest listed department store chain, said it would raise A$221 million ($157 million) in new shares after profits fell 70 percent due to a weaker local dollar and store renovation costs.

The Melbourne-based chain, which has lost more than two-thirds of its market value since a TPG Capital Management LP-led group sold it back to the market in 2009, will offer two new shares for every five existing shares at 94 Australian cents each, 22 percent lower than their last closing price.

Myer needs more cash to reduce debt and invest in shifting more of its business online amid renewed competition from its rival David Jones following a 2014 takeover by South Africa’s Woolworths Holdings Ltd. Myer will buy 25 percent of Arcadia Group Ltd.’s Australian Topshop chain and look to reduce the total area of its store network by as much as 20 percent, according to regulatory statements Tuesday.

“Management has been actively addressing the underlying issues in the business,” Chief Executive Officer Richard Umbers said in a statement. The changes will “return the business to sustainable profit growth”.