Woolworths target PETstock to divest stores, vets after ACCC red flag
Woolworths’ partial acquisition of PETstock has hit a competition snag forcing it to divest a package of stores and veterinary hospitals to try to win approval from the regulator, which found historical transactions by the pet retailer may have breached competition laws.
In December, Woolworths signed a deal to buy a 55 per cent stake in Petspiration Group, which trades as PETstock, the second-biggest player in the sector behind TPG Capital’s Greencross.
In January, the Australian Competition and Consumer Commission kicked off an investigation into how the grocery giant’s planned move into the sector could affect competition. By mid-March, the ACCC suspended its timeline and delayed the final call on Woolworths’ $586 million transaction.
Woolworths CEO Brad Banducci is still looking to get ACCC approval for its PETstock deal.
PETstock now plans to divest 41 specialty pet retail stores, 25 co-located veterinary hospitals, four brands and two online retail stores to address the ACCC’s concerns, which The Australian Financial Review first flagged in May as problematic.
The commission is seeking views on a proposed divestiture offered by PETstock in relation to four completed acquisitions, of Best Friends Pets, Pet City, Animal Tuckerbox and Pet & Aquarium Warehouse in Eltham, Victoria.
These acquisitions, which the ACCC considers raise significant competition concerns, only came to light during its current review into the proposed acquisition by Woolworths, the regulator said on Thursday.
PETstock completed numerous acquisitions between 2017 and 2022 that were not notified to the regulator.
ACCC commissioner Stephen Ridgeway said during the Woolworths-PETstock merger review, industry players expressed concerns about the
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