Woolies inks 15-year fuel deal with Caltex
Woolworths has agreed a 15-year fuel supply deal with Caltex Australia, even as the supermarket giant continues to pursue an IPO or sale of its petrol business.
Australia’s largest supermarket operator says it will also start a wholesale food supply to over 700 existing Caltex convenience sites as part of the deal.
The deal comes two weeks after Woolworths cancelled a $1.8 billion sale of its petrol stations to BP after it was blocked by the competition watchdog.
The grocer wants to exit the business to focus on its supermarkets and other retail operations, and said when the deal was called off that it would pursue “alternative options” for the 527 petrol stations and 16 development sites.
Woolworths on Thursday said it appointed James Goth, its corporate development director, as the petrol business’s chief executive.
Group chief executive Brad Banducci said in a statement that, while he was disappointed with the BP deal’s termination, he felt the customer benefits of the Caltex alliance and the new fuel supply deal would help deliver a “compelling outcome” for customers and shareholders.
The regulator’s refusal in December to greenlight the proposed deal boosted BP rival Caltex, which stood to lose a major fuel supply contract with Woolworths.