Hooker buys back family business

THE grandson of the founder of LJ Hooker, Leslie Janusz Hooker, has paid $82 million to Suncorp Metway to buy back the family business.

By InvestSMART · 16 Oct 2009

By InvestSMART ·
16 Oct 2009

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THE grandson of the founder of LJ Hooker, Leslie Janusz Hooker, has paid $82 million to Suncorp Metway to buy back the family business.

Using a consortium of private cash and his own funds, Mr Hooker struck the deal with Suncorp to pay $67 million in cash for the sale of 100 per cent of Hooker Corp and about $15 million in cash from pre-completion dividends.

The sale had been anticipated as Suncorp made it clear earlier this year that it was selling down what it considered non-core assets to help repay debt, caused mainly by the collapse of property developers on the Gold Coast.

The deal was dependent on gaining approval from LJ Hooker's 500-plus independent owners, who form the group's franchise network.

Mr Hooker will be the new executive chairman, and its managing director, Alan Lambert, will remain in that position.

Mr Lambert said yesterday that the housing market was showing good growth despite rises in interest rates. He said the firm's geographic spread gave it a good buffer against the different stages of recovery occurring across the country.

Sir Leslie Joseph Hooker opened the first LJ Hooker real estate agency in Maroubra in 1928. Through its franchisees the name has spread across 12 countries, including India, China and Japan, and growth will continue with the opening of new offices as the real estate sector improves across Asia. The group focuses on residential, but also has an extensive commercial property business.

"I am excited to have this opportunity to continue the LJ Hooker tradition," Mr Hooker said.

"The deal marks a new chapter in the company's 80-year-old history I am sure my grandfather would be proud to see the company he founded back under the leadership of a member of the family."

Suncorp's group executive for strategy and corporate services, Stuart McDonald, said the bank had received approaches for LJ Hooker over the past few years, but this proposal offered an attractive price for shareholders "as well as an excellent outcome for the LJ Hooker business and real estate network".

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Frequently Asked Questions about this Article…

What happened in the LJ Hooker buyback and who bought the company?

Leslie Janusz Hooker, the founder's grandson, has bought back LJ Hooker from Suncorp Metway. He paid a total of $82 million using a consortium of private cash and his own funds to regain 100% ownership of Hooker Corp.

How was the $82 million purchase price for Hooker Corp structured?

The deal comprised about $67 million in cash paid to Suncorp for 100% of Hooker Corp plus roughly $15 million in cash from pre-completion dividends, together totalling $82 million.

Why did Suncorp Metway decide to sell LJ Hooker?

Suncorp had been selling what it considered non-core assets to help repay debt, largely caused by the collapse of property developers on the Gold Coast, so the sale of LJ Hooker was part of that strategy.

Does the LJ Hooker buyback need approval from franchisees or other stakeholders?

Yes — the sale was dependent on approval from LJ Hooker's 500-plus independent owners who make up the group's franchise network.

Who will run LJ Hooker after the buyback and will management change?

Leslie Janusz Hooker will become executive chairman, while the company's managing director, Alan Lambert, will remain in his current role, keeping continuity in day-to-day management.

What did LJ Hooker management say about the housing market and the group's outlook?

Managing director Alan Lambert said the housing market was showing good growth despite recent interest rate rises. He noted LJ Hooker's geographic spread provides a buffer against different stages of recovery across Australia, and the group expects continued expansion in Asia as property markets improve.

How big is LJ Hooker's international footprint and what parts of the property market does it serve?

Through its franchisees LJ Hooker is present in 12 countries, including India, China and Japan. The group focuses on residential property and also operates an extensive commercial property business.

What did Suncorp say about the sale and the outcome for shareholders and the LJ Hooker network?

Stuart McDonald, Suncorp's group executive for strategy and corporate services, said the bank had received approaches for LJ Hooker over past years and that this proposal offered an attractive price for Suncorp shareholders as well as an excellent outcome for the LJ Hooker business and its real estate network.