Despite persistent efforts by Australian grocer Foodland Associated to clear a legal path to its acquisition attempt on rival Woolworths NZ chain, its Hong Kong-based parent Dairy Farm International has reiterated that it has removed the New Zealand business from sale.
Perth-based Foodland has nevertheless stepped up takeover efforts to get its trans-Tasman subsidiary Progressive Enterprises classified as a legally qualified buyer.
Foodland’s second application to buy Woolworths NZ, a company unrelated to Australia’s largest retailer of the same name, was turned down by the NZ Commerce Commission (NZCC) last month. The decision came after months of legal wrangling, and concluded that a takeover bid by Progressive, the second largest grocer in New Zealand, of the third largest grocer in the country could not be cleared due to competition concerns. The largest chain in New Zealand is Foodstuffs.
Foodland MD Trevor Coates admitted to the Associated Press yesterday [Wednesday] that “ultimately Dairy Farm may decline to consider any offer we make to them to buy Woolworths NZ.
“However, unless the present legal impediments to our acquisition are removed, we will not be in a position to hold meaningful discussions with them.”
Coates explained in a statement that Foodland would lodge documents with the NZ High Court to enable Progressive to appeal the NZCC decision over clearance for the acquisition.
“Although a final decision to appeal the case has not yet been made,” he said: “Progressive has made preliminary arrangements to have the case heard in late April 2002.”
A spokeswoman from Dairy Farm said that the information given in the company’s press release on 20 December, essentially removing the chain from sale, was still valid. Dairy Farm will not hold any further discussions about a sale.
Australian giant Woolworths turned down a “take it or leave it” offer to buy Woolworths NZ last month, saying that the price was too high. If a more “appealing price” is offered, the grocer said this week that it is still interested in the business however.