Department store David Jones has revealed that its rival Myer proposed a merger of the two retailers late last year as it struggled against competition from online retailers and international chains.
In a statement, David Jones says Myer made the suggestion in late October and that its board decided soon after to reject the offer.
“The David Jones board believed that the potential transaction did not represent sufficient value for David Jones shareholders,” the statement said.
“The execution and implementation of any such transaction would have substantial commercial, market, business and regulatory risks, including the ACCC review process.
“It would involve the diversion of company resources over a lengthy period with great uncertainty as to the final outcome and the potential to result in diminution of value of the David Jones business.”
David Jones made the announcement in response to reports in Fairfax Media that Myer is considering suggesting such a partnership.
It says it is not in talks with Myer regarding a merger, and that it will tell shareholders if it does receive a proposal which is in their best interests.