South Island department stores merge as H&J Smith buys Arthur Barnett

  • News
  • May 14, 2015
  • Sarah Dunn
South Island department stores merge as H&J Smith buys Arthur Barnett

Founded in 1900, H&J Smith currently has department stores located in Invercargill, Gore, Queenstown, Te Anau and Balclutha. Arthur Barnett is only slightly younger, founded in 1903.

H&J Smith managing director Jason Smith says his company has had a cordial relationship with Arthur Barnett for many years. An image in H&J’s centennial book depicts staff from both stores taking part in a cricket match in 1956, and Smith says the companies would frequently split container-loads of goods.

“You try to find allies to work with, and we had a very long-standing relationship.”

The mood changed in the 1980’s when Arthur Barnett bought out the D.I.C department store company. Smith says this made it impossible to carry on as they had before, and the companies worked on the occasional project together but ceased to consistently collaborate.

Late last year, discussions around H&J’s acquisition of Arthur Barnett began. Smith says there were two aspects to be negotiated – Arthur Barnett itself, and its leasing arrangements. Both were “challenging”, but the company’s shared history eased the way.

“We share a lot of the same values, and it’s been a very straightforward process based on that relationship.”

Smith would not reveal how much the takeover was worth.

The Arthur Barnett brand is now due to be retired. Smith says the store will be renamed in around two months, although this will only happen once H&J Smith is certain all of its services can be offered in Dunedin. A new 10 year lease has been secured for Arthur Barnett’s anchor position in the Meridian Mall.

“It’s very exciting for our group to enter the Dunedin market.”

Smith says that for him, the best part of the deal is that all Arthur Barnett staff will retain their jobs. He promises it will be “business as usual” for customers when the takeover comes into effect on Monday.

There will be some people who are nervous about the changes, says Smith, but he says H&J Smith is committed to keeping them there and learning about how Arthur Barnett works.

“They’ve been doing business their way for decades.”

Arthur Barnett director Mike Coburn says the decision to pass control of the store to H&J Smith was made because its shareholders and directors felt its interests would be best served by being put into a larger group with a dominant position across the combined Otago and Southland markets.

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