MITRE 10 and Home Timber and Hardware customers in the Wimmera will not be negatively affected by one chain’s plan to buy the other.
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That’s what the company behind the takeover, Metcash, has said.
Mitre 10 franchise owner Metcash won approval last week from the Australian Competition and Consumer Commission to purchase Home Hardware from joint owners Woolworths and Lowe’s.
If the estimated $250-million deal goes ahead, 350 Home Hardware stores and 430 Mitre 10 linked franchisee stores will have the same controlling entity.
The Mail-Times understands that the acquisition was driven in part by hardware store managers around Australia telling head office that they have been under huge pressure over prices.
Managers have complained that the Bunnings Warehouse hardware chain, owned by retail giant Wesfarmers, was capable of influencing hardware prices with a 100-kilometre radius of each store.
Horsham has a Bunnings Warehouse.
Mitre 10 and Home Hardware would still compete with each other at Nhill, but would be in the same network.
Home Hardware also has a store at St Arnaud and Mitre 10 has a store at Horsham.
Mitre 10 franchisee David O. Jones has stores at Stawell and Ararat.
A Wimmera hardware store franchise manager was not able to be directly quoted in the media but told the Mail-Times that independent hardware stores were here to stay.
Mitre 10 is run as a co-operative where every store is independently owned and has a vote to influence decisions made by its controlling entity, Metcash.
A Metcash spokeswoman said that nothing would change for customers if the company bought Home Hardware.
“That’s why we spent so much time at the Australian Competition and Consumer Commission,” the spokeswoman said.
“It was to reassure the commission that there would be no effect on competition.”
Metcash also manages the Independent Grocers of Australia supermarket franchise.
Woolworths, the joint owner of Home Hardware, announced on Monday that it would cut 500 jobs in its support and supply divisions and close dozens of under-performing supermarkets.