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Australia's Metcash, which includes the IGA independent supermarkets, is hoping to acquire the Franklins chain of 77 corporate and 8 franchisee supermarkets for an estimated $215 million. Metcash's performance toward it's independant retailers has been questioned.
Metcash expects the independent retailers who purchase the stores will lift each store’s performance through the successful combination of their own retailing expertise and through utilising the strength, services and support provided by Metcash; especially our national buying power, world class supply chain and marketing and merchandising programs. Andrew Reitzer - Metcash CEO
But it might not be a done deal.
Regulatory approval for Metcash's planned Franklins deal is no sure thing, given that the ACCC has long expressed concern at its treatment of independent retailers. On paper, the deal is a smart one for Metcash's Andrew Reitzer: spend $215 million to buy some 85 supermarkets that make no money. Reitzer doesn't really care if the retailer makes money - as long as he or she stays in business and keeps buying goods from his wholesale outlets. John Durie
This is typically where Reitzer and ACCC chairman Graeme Samuel would share some quiet time and a deal would be struck.