Woolworths Ltd has won a legal battle against its joint venture partner, Lowe’s, over the future of their failed Masters home improvement banner.
The case revolves around Woolworths’ decision to exit the business via three separate contracts which would bring in gross proceeds of A$1.5bn. The deals would also see all Masters’ stores being shut down by 11 December.
However, Lowe’s filed a motion before the Federal Court of Australia, requesting the appointment of a liquidator to oversee the winding up of the JV. In its motion, Lowe’s had stated that Woolworths had “engaged in oppressive conduct, including by invalidly and in bad faith attempting to terminate the JV”.
The Federal Court has ruled against Lowe’s, granting Woolworths’ an application for a stay of the suit filed by the US group. The court also ordered Lowe’s to pay Woolworths’ costs of the application and vacated the provisional listing of Lowe’s action for hearing in October.
It additionally accepted Woolworths’ submission that disputes between the two sides must be heard in arbitration, as Lowe’s had previously agreed to do.