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.

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.

GlobalData Strategic Intelligence

US Tariffs are shifting - will you react or anticipate?

Don’t let policy changes catch you off guard. Stay proactive with real-time data and expert analysis.

By GlobalData

Learn more about Strategic Intelligence

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”.

Sign up for our daily news round-up!

Give your business an edge with our leading industry insights.

Sign up