Over Masters sale.
US retailer Lowe’s has initiated Federal Court action against Woolworths, accusing the company of wrongfully attempting to terminate the joint venture (JV) and asking for a liquidator to oversee the wind-up of Masters.
Lowe’s owns one-third of the company it created with Woolworths, Hydrox Holdings. It accused Woolworths of seeking to exclude Lowe’s from the management of Hydrox.
Noel Hutley, for Lowe’s subsidiary WDR Delaware Corp, told the Federal Court in Sydney on Wednesday that Woolworths is selling off the joint venture without proper legal authority, according to media reports.
“Now that, I would have thought, in relation to an organisation of this size, is a matter of deep concern and it’s a matter of deep concern to us,” he reportedly told the court.
“And to say that we have no economic interest in the outcome, is within our respective submission flawed. The joint venture agreement clearly contemplated that pending the outcome of any buyout, we would remain on the board and have all the powers that flow from that.”
However, David Thomas of Hydrox, reportedly questioned the urgency of Lowe’s application, given the sale of Masters had been planned since January. He said Lowe’s had already exercised its put option to sell Woolworths its 33 per cent share of Masters.
Justice Lindsay Fisher ordered both parties to return to court for the interlocutory hearing on September 15, 2016.