Progressive gets regulatory nod for Woolies

Progressive is owned by Perth-based Foodland (NZSE: FAL) and owns the Foodtown, Coustdown and 3 Guys brands.

The clearance is subject to divestments of supermarkets in Birkenhead on Auckland's North Shore and in Te Awamutu.

Commission chairman John Belgrave says the Commission was satisfied that, should the proposed acquisition go ahead, Progressive would not acquire or strengthen dominance in any market.

"For most areas the merged entity would face strong competition from either Pak'N Save or New World, banner groups owned by the Foodstuffs co-operatives."

Markets in which there would be aggregation of market share include retailing grocery items in supermarkets and the national market for the wholesale supply of groceries.

Woolworths operates under three brands in New Zealand - Woolworths, Big Fresh and Price Chopper and has also formed an alliance with independent petrol retailer Gull Petroleum to operate outlets in its 17 service stations.

The company is 100% owned by Hong Kong-based food distributor, Dairy Farm, which last year had sales of US$6.6 billion.

Dairy Farm has recently been selling off a number of it Franklins stores in Australia but has not yet confirmed whether it is ready to sell its profitable Woolworths chain in New Zealand.

In May the company said it had received an unsolicited and unexpected expression of interest from Foodland but needed to consider the merits of any offer.

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