Australia’s competition watchdog has today advised that it will not oppose the acquisition of organic supermarket operator Macro Wholefoods by Australia’s largest supermarket operator, Woolworths.
Woolworths announced the proposed takeover of Macro last month and plans to turn all Macro stores into outlets of their upmarket grocery subsidiary - Thomas Dux*. They will also acquire ownership of the Macro Organic private label brand.
“Organic products are only a small component of the range in Thomas Dux stores and make up less than one per cent of sales in Woolworths’ full-range supermarkets; their closest competitors are other supermarkets,” acting ACCC Chairman, Mr Peter Kell, explained.”In contrast, Macro focuses almost entirely on organic products. It is less competitive on price, instead emphasising range, quality, service, location and convenience. The ACCC’s extensive inquiries found Macro’s closest competitors to be smaller, independent retailers with a similar focus. These competitors will remain in the market after the acquisition, continuing to provide consumers with choice.”
* The Thomas Dux Grocer store format was first introduced last year by Woolworths to compete with the proliferation of upmarket grocers. There are currently two in operation, with the outlets smaller than the retailer’s conventional supermarkets and offering more premium groceries.