The joint venture between Woolworths Ltd and Lowe’s has received approval from the Australian competition regulator to buy Danks Holdings, the country’s second-largest hardware distributor. The JV, called Carboxy, had agreed to pay A$88m (US$82m) for the company, and the Australian Competition & Consumer Commission said it believed the deal will not “substantially lessen competition”.
The ACCC’s ruling came after Carboxy agreed to special arrangements on how it deals with independent stores. It said those agreements will make it easier for smaller stores to switch to alternative suppliers and ensure that existing stores located near new hardware stores set up by Carboxy are not treated “less favourably”.
The regulator note, “The ACCC was concerned that the joint venture could discriminate against some of its wholesale customers, namely hardware retailers supplied by Danks, who would also be its retail competitors. The ACCC has accepted court enforceable undertakings from the joint venture in order to address these concerns.”
The JV, which has not yet decided on a name for the format, plans to open up to 150 large-format stores of about 10,000 sq m, with the first site chosen for Coolaroo in Victoria state.
Namnews - Wednesday 11th November 2009
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