Metcash Trading Limited - proposed acquisition of Foodland Australia Limited


Metcash is engaged in the business of grocery and liquor wholesaling and distribution in Queensland, New South Wales, Victoria, South Australia and the ACT. It is the largest independent wholesaler of groceries in Australia. It proposes to acquire Foodland, a supermarket operator and grocery wholesaler trading in Western Australia, Queensland, northern New South Wales, and New Zealand.

Market definition

For the purpose of competition analysis, the proposed acquisition was assessed in relation to the following markets:
- an integrated supermarket market.
- a wholesale market for the supply of groceries to supermarkets, both on a state basis and on a national basis; and
- a large number of local retail supermarket markets.

Competition analysis

The proposed acquisition is unlikely to substantially lessen competition at the retail level, since there is only a limited geographical overlap (in Queensland and Northern New South Wales), and in those areas where the overlap occurs there will be continued strong competition from the other market participants. At the wholesale level there is virtually no overlap, as Metcash does not operate in Western Australia, the only state in which FAL operates as a wholesaler and distributor servicing independent supermarkets.

Merger type