Opposition to acquisition of undeveloped land by supermarket
In one of the first decisions since the commencement of the ACCC’s streamlined assessment for single supermarket acquisitions (“Protocol”) (blogged about here), the ACCC has decided to oppose Woolworth’s acquisition of an undeveloped supermarket site at Glenmore Ridge in the suburb of Glenmore Park, New South Wales.
The decision is important because it is the first time, as far as we are aware, that the ACCC has opposed the acquisition of a small parcel of undeveloped land. The land in question comprises a 2.1 hectare block of undeveloped land located in the recently released Glenmore Ridge residential estate, in western Sydney. The present zoning of the site is for the construction of a supermarket, as well as complementary specialty shops such as bottle shops, banks and post offices
Woolworths, the only supermarket currently operating in the suburb, proposed to acquire an additional site taking the total number of supermarkets in the area to 2 – that is until ALDI opens ups its doors in 2014. According to Rod Sims, the Chairman of the ACCC, the decision centred around “Glenmore Park residents having two Woolworths and one ALDI supermarket, or having three different supermarkets in their area” and that “[A]n alternative supermarket at the Glenmore Ridge site would stimulate local competition and provide greater choice to residents of the area. Woolworths buying the site would prevent that from occurring”.
Interestingly, public review of the matter began on 20 June 2012, a couple of months before the commencement of the Protocol and at a similar time to the commencement of negotiations of the Protocol, about which Woolworths could not come to agreement with the ACCC. Their decision to notify the ACCC of the potential acquisition is, however, in line with Woolworth’s policy to notify the ACCC at their discretion of certain types of transactions.
The ACCC’s public competition assessment is not yet available but will be soon on the ACCC’s website.