16/10/2007 - 22:00

Metcash sells stores

16/10/2007 - 22:00

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Metcash sells stores
FOOD and liquor wholesaler Metcash Ltd has sold the remaining 12 of its former Action supermarkets in Western Australia for between $40 million and $45 million. “The large format Supa IGA stores have been sold to a joint venture of existing independent IGA retailers and former executives of FAL, with Metcash to retain a minority stake,” the company said. Former Action general manager Rod McPhee is understood to be involved in the deal. The 12 bigger stores were included in the 82 outlets Metcash absorbed when it took over Foodland Associated Ltd’s Australian wholesale and retail business in 2005. The divestment was subject to due diligence and expected to be completed by the end of this month. Metcash has already sold off Foodland’s 45 outlets in New South Wales and Queensland, and 25 smaller outlets in WA, to independent franchisees. FW Holst retail analyst David Spry said Metcash had hung on to the 12 larger WA stores for two years to make sure they went to an appropriate owner. “It’s more than just what a smaller independent can manage,” he said. “You’re looking at a huge amount of square metres inside. They had to find the right buyers and get the right people to run it because they’re important stores.” The wholesaler supplies goods, as well as training and support, to the nationwide chain of IGA-branded stores. In 2006-07, the number of IGA-branded stores increased to 1,256 from 1,209. Andrew Hobbs

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