Shares in the Warehouse dropped 61 cents to $3.21 this morning following the Court of Appeal reversing a High Court decision to allow the sale of the Warehouse to either Foodstuffs or Woolworths.
A loss for shareholders was nevertheless hailed as a gain for consumers by the Commerce Commission, and a victory for competition in markets.
ComCom chair Paula Rebstock says, “New Zealand consumers know that more competition is needed in the supermarket sector. In coming to its decision to decline the acquisition the Commission considered that The Warehouse had already brought important new dimensions to supermarket competition, and potential competition, through its innovative supercentre stores."
The Commission declined clearance in mid-2007 for acquisition by either Foodstuffs or Woolworths, arguing New Zealand’s supermarket retail market is already highly concentrated. “There are high barriers to entry in the industry, yet The Warehouse is uniquely placed to compete with the supermarkets because of its existing property portfolio, extensive distribution networks and established brand” according to a statement the Commission released today.
The Commission is studying the judgment and won’t comment further until the full reasons for the judgment are released publicly by the Court of Appeal.
This article is tagged with the following keywords. Find out more about MyNBR Tags
- OPINION: Initial observations on the Dotcom decision
- The PM can say whatever he wants – NZ Super Fund chairwoman
- Dan Carter’s 'perfect' PR playbook
- How can Comvita cope with Chinese tax crackdown?
- Sky TV-Vodafone merger: Competition lawyer rates odds of success for Spark's last-minute legal challenge
Most listened to
- Land Rover's severing of ties with Dan Carter is ‘a template for the way in which these things should be handled’
- NZ Super Fund chairwoman Catherine Savage shrugs off the PM's criticism of her board
- Rick Shera - 'I suspect Kim Dotcom and his lawyers will be visiting the Supreme Court more than once'
- Judith Collins on the findings in the IEA's latest five-yearly review of energy policies
- Comvita CEO Scott Coulter on how Chinese regulations have hit the company hard
- NBR’s Campbell Gibson reports on a farming couple’s case against ANZ for interest rate swaps
- New Zealand Bankers' Association chief executive Karen Scott-Howman defends banks' handling of privacy