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Woolies deal under review

The Australian Competition and Consumer Commission (ACCC) is reviewing Woolworths’ plans to buy three jointly owned Supa IGA supermarkets in Queensland from wholesaler Metcash, and independent retailers Cornetts and Walters. Resource-5

Metcash owns around 50 per cent of Cornetts and Walters, and was forced to take charges of $106 million against investments and loans to the two after they came close to collapse last year, reports the Australian Financial Review.

More than half of Cornetts’ 48 stores were sold or closed and Walters was forced to close seven of its eight stores. Most of the stores were sold to independent retailers trading under Metcash’s IGA banner.

A Metcash spokesperson said to the AFR it was not unusual for Metcash, Woolworths, and Coles to sell stores to eachother, even though they competed aggressively.

“Sometimes there are footprints that work better for them and sometimes they us smaller stores that don’t work for them,” the spokesperson said.

A spokeswoman said Woolworths approached the ACCC with details of the three potential deals following the regulator’s recent crackdown on “creeping acquisitions”.

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