Do you tend to shop for your home mostly from Kmart? Or does your family prefer pushing a trolley and browsing the shelves at Target?
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The rumours are true. Kmart and Target are officially merging. Australian retail conglomerate Wesfarmers (WES.AX) made the announcement on Tuesday sharing the reasoning for the merger as a bid to reduce losses amid high inflation.
But don’t fret if you are a mega fan of a particular store, it’s been made clear that the stores and branding will remain separate.
Who are Wesfarmers?
Wesfarmers have owned both Kmart and Target since 2007 when it acquired Coles. Wesfarmers’ other businesses include: Bunnings Warehouse, Beaumont Tiles, Officeworks and Priceline Pharmacy.
Why is Kmart and Target merging?
“The announcements today are an internal reorganisation of our support offices,” Kmart Group managing director Ian Bailey said in a statement.
“What we found was that running two businesses it was very, very difficult to get the tech into Target, and to get those benefits. This is really why we decided to push the two businesses into one,” Mr Bailey told the Australian Financial Review.
The restructure means that Kmart and Target will be one business with a value of $10 billion.
Will the staff at Kmart or Target be affected?
As per the Wesfarmers’ website the two brands operate 452 stores, including 324 Kmart and 128 Target stores across Australia and New Zealand.
Mr Bailey said “For store networks and 50,000 store team members – it’s business as usual.”
Kmart chief executive John Gualtieri will oversee the stores’ day-to-day operations. Meanwhile, Target managing director Richard Pearson has moved to a new role as retail director of Wesfarmers’ health unit.
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