BALLARAT hardware owner David Gay says a block by Australia’s competition watchdog is “bewildering”.
The Australian Competition and Consumer Commission yesterday ruled against a proposed joint venture between Woolworths and American company Lowe’s to buy three hardware stores owned by independent Ballarat chain G Gay & Co.
A delayed decision concluded the only remaining key competitor in the region would be the Wesfarmers-owned Bunnings.
G Gay & Co owner David Gay said his company would fight the decision, possibly in court, and was awaiting advice from Woolworths for the next step to take.
“It’s taken seven months to come to a decision and we knew they had some concerns but we gave them every bit of information they asked for. We’re disappointed,” Mr Gay said.
“Everyone who knows Ballarat and the market, knows the competition around. Us being owned by Woolworths is not going to change that much.”
The Courier understands this is the first ACCC investigation into Woolworths’ hardware ventures.
The ACCC confirmed this Ballarat proposal was among a number of cases in the multinational’s portfolio being investigated.
Woolworths has secured a Wendouree site to establish its Masters “big box” hardware and appliance warehouse in 2013.
The joint venture had sought to acquire three existing G Gay & Co stores – two Home Timber and Hardware stores and Ballarat Building Supplies – in the lead-up to the Masters opening.
A submission was put forward in February and the ACCC has twice delayed a decision, seeking more information.
ACCC chairman Robert Sims said the commission was concerned the removal of a key independent competitor would be detrimental to Ballarat consumers.
“G Gay & Co is a vigorous and effective competitor in terms of price, product range and service and is likely to provide a strong competitive constraint on Masters in the Ballarat area,” Mr Sims said.
Mr Gay said the ACCC needed to consider the bigger picture, which included competitors in Dahlsens, Robert Sims Building Supplies, Whitehead Timber Sales and specialty stores like Reece and Total Tools.
The ACCC statement of issues details independent multi-category stores like Sims and Whitehead Timber “do not supply the range of products from as many product categories as the Gay Stores do” within the Ballarat market.