Australian wholesale grocer Metcash has announced it will spend up to A$480m (US$437m) to overhaul its business to prepare it for “long-term sustainable growth”.

Metcash plans to spend A$100m-$125m to fund store refurbishments, new stores and store buybacks.

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The retailer wants to drive efficiency by investing in its infrastructure and also provide better support to its independent retailers through the expansion of its digital platform.

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The programme will take place over the next three years. Investment in the first year is estimated to peak at between A$150-$180m in 2015 and reduce to A$130m-$150m in 2016 and 2017.

To fund the project, Metcash will reduce dividend payout ratio to 60% starting from the final FY14 dividend.

CEO Ian Morrice said Metcash wanted to “reignite top-line growth within the food and grocery channel”.

He said initial pilot programmes had proved “positive” and that “retailers working with Metcash are strongly supportive of the plan”.