By Patrick Avenell
The ongoing difficulty of Woolworths and its joint venture partner Lowe's to establish its Masters big box hardware and appliance warehouses in Australia took another turn today when the ACCC confirmed it would oppose its acquisition of a existing competitor in Ballarat, in Victoria.
Woolworths plans on opening a store in Wendouree to service the Ballarat area in 2013. In the lead-up to this opening, Woolworths had sought to acquire three existing hardware stores, owned by G Gay & Co, operating in the greater Ballarat area. If Woolworths were to buy these three stores, it would only have to compete with Bunnings, which is owned by Wesfarmers.
“The ACCC is concerned about the removal of a key independent competitor from the market to the detriment of competition and local consumers.” Sims said.
“G Gay & Co is a vigorous and effective competitor in terms of price, product range and service and is likely to provide a strong competitive constraint on Masters in the Ballarat area.”
As reported earlier this week on Current.com.au, Woolworths has struggled to open new Masters stores since announcing a target of 150 warehouses in 2011. The biggest roadblock in major cities has been securing suitable land for such a large format store.