The Australian Competition and Consumer Commission says it will not block Woolworths’ acquisition of organic grocery chain Macro Wholefoods, as it is unlikely to reduce competition in the organic grocery market.
Under a deal announced in mid-May, Woolworths will acquire Macro’s organic supermarkets at Crows Nest, Hornsby and Mona Vale in NSW, at Richmond, Black Rock, Glen Waverley and Armadale in Victoria, and a store in Port Melbourne that Macro leased but never opened.
Macro’s Bondi Junction store will be sold separately to an independent organic retailer, About Life.
Woolworths plans to merge the Macro chain with its current boutique grocery chain, Thomas Dux, which has two stores in Sydney.
While grocery wholesaler Metcash had raised concerns about the deal, acting ACCC chairman Peter Kell has given the deal the green light.
“Organic products are only a small component of the range in Thomas Dux stores and make up less than one per cent of sales in Woolworths’ full-range supermarkets; their closest competitors are other supermarkets,” Kell said in a statement..
“In contrast, Macro focuses almost entirely on organic products. It is less competitive on price, instead emphasizing range, quality, service, location and convenience. The ACCC’s extensive inquiries found Macro’s closest competitors to be smaller, independent retailers with a similar focus. These competitors will remain in the market after the acquisition, continuing to provide consumers with choice.”
James was the editor and publisher of SmartCompany and LeadingCompany for five years. He is now the Australian Financial Review‘s companies & markets editor, and a former BRW editor.
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