The Australian Competition and Consumer Commission has written to pet goods suppliers and other industry players, to investigate how Woolworths’ planned move in the sector could impact competition.
The ACCC sent letters to industry players this week, asking them about competition for pet products and services and how speciality pet chains like Petspiration’s PETstock may overlap with Woolworths’ supermarkets or Big W chain.
The regulator had separate questions for pet product and services wholesale suppliers and retailers. There were 16 questions all up.
The ACCC called for submissions by February 14 and said it was hoping to form its view by April 20.
It comes only one month after Woolworths signed a deal to buy a 55 per cent stake in Petspiration Group, the second-biggest player in its sector behind TPG Capital’s Greencross.
Petspiration owns PETstock and has a network of 276 stores, eCommerce platforms and a loyalty program with 2.4 million members. Woolworths is investing alongside founders Shane and David Young.
On announcing the deal, Woolworths boss Bran Banducci said the supermarkets bigwig had a “limited presence” in the large and growing specialty pet segment.
ACCC and New Zealand antitrust approval were listed as customary closing conditions.
Sell-side analysts were unconcerned about competition approvals when the deal was announced in December.
“We view the announced acquisition of Petspiration Group as an incrementally positive step in the evolution of WOW’s eco-system strategy,” Goldman Sachs analysts told clients.
“The transition from liquor retail and gaming/hotels into higher growth, and closer synergies with the family shopper pet retail is in line with its strategy of building a reinforcing retail ecosystem.”
Extracted from AFR
