Woolworths has added more stores to its hardware chain by agreeing to pay $40 million to acquire Gunns’ five stores in Tasmania.
It will also acquire the Becks Timber & Hardware business.
Gunns said this morning it had agreed to sell its hardware retail business to Blue Mountains Hardware, a wholly-owned subsidiary of John Danks & Son.
Danks was acquired in November 2009 by Carboxy, a joint venture between Woolworths and US hardware giant Lowe’s Companies, the world’s second biggest home improvement retailer.
Gunns said the agreement came after a competive bid process, which assessed offers from various parties.
All employees at all of the retail sites will be retained under this transaction, Gunns chief executive Greg L’Estrange said in a statement.
In a separate statement, Danks said the acquisition included one timber joinery centre, one truss manufacturing plant and a support office.
‘‘As part of the acquisition, Danks will make offers to retain all employees of the Gunns business, including support staff and management,’’ the company said.
General manager of Danks, Graeme Danks, said the acquisition would give consumers in the Tasmanian hardware sector more choice and help to maintain the employment of 283 people.
In the same announcement today, Danks said it had agreed to acquire the Becks Timber & Hardware business.
‘‘All Becks employees will receive offers of employment,’’ Danks said.
Carboxy’s takeover of Danks last November came after the Australian Competition and Consumer Commission (ACCC) secured undertakings from Woolworths, which the regulator said would address its concerns over price discrimination caused by Carboxy acting as both a wholesaler and retailer.
Woolworths and Lowe’s hope to take on Wesfarmers’ successful hardware chain and cash cow, Bunnings, and carve up Australia’s $24 billion hardware market by creating 150 warehouse-type hardware stores that will compete with Danks’s independent retailers.
Danks’s independent retailers include Home Timber & Hardware, Thrifty-Link Hardware, and Plants Plus stores.
AAP