The competition regulator is allowing struggling clothing maker Pacific Brands to sell its workwear business to Wesfarmers.
The maker of Hard Yakka, KingGee and Stubbies announced the $180 million sale in August.
The Australian Competition and Consumer Commission (ACCC) announced on Thursday it would not oppose the sale to Wesfarmers, which owns supermarket giant Coles.
The regulator’s chairman, Rod Sims, said the ACCC had concluded that Wesfarmers would be unlikely to restrict access to the workwear brands by resellers and other retailers.
“Industry feedback suggests that brand loyalty has diminished over recent years as customers become more focused on quality, price and service,” he said in a statement.
Sims said Wesfarmers would face import competition with its new acquisition.
“Wesfarmers will continue to be constrained by a number of existing suppliers and by actual and potential imports from Asia,” he said.
He also expected new wholesalers and resellers to enter the market in coming years.
“In retail markets, Wesfarmers will face competition from other retail chains and local outlets for the supply of workwear,” he said.
Pacific Brands chief executive David Bortolussi and his Wesfarmers counterpart Richard Goyder each issued statements welcoming the ACCC decision.