ACCC calls for comment on proposed acquisition of Danks by Woolworths and Lowe's
The Australian Competition and Consumer Commission today issued a Statement of Issues on the proposed acquisition of Danks Holdings Limited by a joint venture controlled two-thirds by Woolworths Limited and one-third by Lowe's Companies, Inc.
Danks is a wholesale distributor of hardware products and related services. Lowe's is a home improvement retailer based in the United States with no business activities in Australia at present.
The Statement of Issues seeks further information on certain competition issues which have arisen from the ACCC's market inquiries to date. The ACCC considers that even if Woolworths and Lowe's didn't acquire Danks, Woolworths would still be likely to open a network of big box home improvement stores in Australia and these issues are being examined with this in mind.
The ACCC is seeking further comments on issues relating to concerns that a reduction in the number of wholesale suppliers as a result of the proposed acquisition may cause a reduction in competition at the retail level.
The ACCC is also seeking comments on whether Woolworths would have both the ability and the incentive to discriminate against its wholesale customers, namely independent hardware retailers, who will also be its retail competitors.
The ACCC invites further submissions from interested parties by 23 October 2009. To allow for submissions in response to the Statement of Issues, the ACCC anticipates that the final decision will be announced on 11 November 2009.
