BP Axes $1.8 Billion Woolworths Servo Station Deal
BP has withdrawn its $1.8 billion purchase of Woolworths 531 petrol sites, after the ACCC rejected the deal last year. Some commentators speculate Woolworths is banking on sales proceeds to invest in its retail portfolio, including embattled department store Big W.
The supermarket giant intended to challenge the ACCC’s ruling, however, has today advised it’s pursuing alternative options for its petrol business.
BP Australia Chief, Andy Holmes, affirms despite “best efforts” a suitable transaction could not be structured, one which met the company’s objectives.
As previously reported, commentators forecast sales proceeds will be invested into Woolworths’ retail family, including struggling department store Big W.
In Q1FY18, Big W post a 2.5% sales increase to $890 million – its first turnaround in several quarters.
Back in December 2016, Woolworths agreed to sell its petrol stations, convenience stores and development sites to BP in a $1.8 billion deal – an arrangement the ACCC rejected, over the risk of reduced fuel price competition.
The ACCC asserts BP’s fuel prices are already higher than Woolies in major cities, with BP’s rates increasing comparatively faster.
The purchase would significantly increase BP’s service station presence in Australia, which currently sits around 1,400 outlets.
Woolworths is currently pursuing an alternative plan, which reportedly retains Caltex as the fuel supplier. The deal will provide new management for its convenience stores.