It’s April 2014, and Woolworths drops a bombshell: CEO Ian Moir has just told the market his company will buy struggling Australian department store chain David Jones for R21.4bn, the largest foreign takeover yet by an SA retailer. That morning, Moir hosted a conference call, throwing around the usual MBA jargon used to justify these immense, crossborder deals: "increased scale", "significant efficiencies" and, of course, "diversification". Reuben Beelders, a seasoned portfolio manager at Gryphon Asset Management, was sceptical. "I was concerned that Woolworths management hadn’t learnt from the mistakes of other SA retailers who had failed in Australia. Management’s responses to analysts did nothing to ease my concerns." A fair point. Pick n Pay had come unstuck in Australia twice. In 1984, it opened a hyperstore in Brisbane only to swiftly close it; then in 2001, it bought 80 grocery stores under the Franklins brand, which it sold nearly a decade later with little return. It was th...

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