Coles’ acquisition of five Supabarn supermarkets in NSW and the ACT has been approved by the Australian Competition and Consumer Commission (ACCC).

Coles, owned by Wesfarmers, had originally proposed to acquire nine supermarkets from Supabarn but had to restructure the transaction after the ACCC expressed concerns that the proposed acquisition would substantially lessen competition.

“The ACCC’s review focused on two main issues,” said ACCC chairman, Rod Sims. “These were the effect of the acquisition upon competition between supermarket chains in the Canberra region and the effect upon each of the individual local markets in which the Supabarn stores operate.”

Coles now proposes to acquire supermarkets in the Canberra Centre, Kaleen and Wanniassa in the ACT, and Five Dock and Sutherland in NSW.

“We received vocal feedback from members of the public that Supabarn is competitive and has a differentiated offer from that of the other major supermarket chains. This was borne out by our own analysis.”

“We were also concerned that the proposed acquisition, as originally structured, would have led to significant competitive harm in some of the local markets in the ACT and NSW. In these areas, Coles and Supabarn stores are located close together, and there is limited competition from other supermarkets.”

Sims said the deal had been restructured so that the ‘most problematic stores’ had been removed. “It also retains Supabarn as a supermarket chain after the acquisition is completed with Supabarn being free to compete under the Supabarn name,” said Sims.

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