ACCC approves Wesfarmers' acquisition of Catch Group

Consumer commission finds no threat to change in competition playing field from businesses operating in different marketplaces

The sale of Catch Group to Wesfarmers has been given the greenlight by the Australian Competition and Consumer Commission (ACCC) following an anti-competition review.

The industry watchdog announced its review of the proposed acquisition, first announced in June, to consider both bricks-and-mortar and online retail competition, and whether there would be any potential impact on third-party sellers in that retail space. 

“The current growth in online marketplaces is fostering competition between providers, and feedback indicated that Wesfarmers’ proposed acquisition of Catch would be unlikely to change that level of competition,” ACCC commissioner, Stephen Ridgeway, said in a statement.

ACCC found Catch is an online retailer selling off-season, clearance or overrun branded products and operates an online marketplace, while Kmart and Target are predominately bricks and mortar stores.

“Stakeholders also consistently told us that Catch and Wesfarmers are not close competitors, primarily due to the differences in their business models,” Ridgeway said.

According to the ACCC, the proposed acquisition will not reduce online marketplace options for third-party sellers as Wesfarmers will be a new entrant and Wesfarmers-Catch will compete with other online marketplaces. Further, the ACCC found there has been significant growth and new entries into online marketplaces over the past few years in Australia, including by Kogan and Amazon.

The $230 million acquisition was announced in June and is to be funded from existing debt facilities. It is not expected to affect Wesfarmers’ existing credit ratings. Wesfarmers also owns retail brands including Kmart, Target, Bunnings and Officeworks, as well as host of industrial brands.

In a statement at the time the acquisition was announced, Westfarmers described Catch Group as an established, profitable and cash-generative business that operates an online business model offering branded products on a first-party basis and a third-party online marketplace. Catch Group will operate as an independent business unit, under the oversight of Ian Bailey, the managing director of Kmart Group.

Wesfarmers managing director, Rob Scott, said previously the acquisition is consistent with the group's disciplined approach to capital allocation, including investment in opportunities adjacent to its existing businesses.

“This acquisition represents an opportunity to accelerate Wesfarmers and Kmart’s digital and ecommerce capabilities while continuing to invest in the unique customer and supplier proposition provided by Catch Group.”

Follow CMO on Twitter: @CMOAustralia, take part in the CMO conversation on LinkedIn: CMO ANZ, follow our regular updates via CMO Australia's Linkedin company page, or join us on Facebook: https://www.facebook.com/CMOAustralia.

Join the newsletter!

Or

Sign up to gain exclusive access to email subscriptions, event invitations, competitions, giveaways, and much more.

Membership is free, and your security and privacy remain protected. View our privacy policy before signing up.

Error: Please check your email address.
Show Comments

Blog Posts

How to create profitable pricing

How do we price goods and services? As business leaders, we have asked ourselves this question since the history of trading.

Lee Naylor

Managing partner, The Leading Edge

Sport and sponsorship: The value of event sponsorship

Australia’s cricketers captured the nation’s attention during their recent run to the semi-final of the ICC Men’s World Cup. While the tournament ultimately ended in defeat, for over a month it provoked a sense of belonging, hope and empowerment for millions of people across Australia. Cricket, and sport in general, has a near-unique ability to empower individuals, irrelevant of their background, demographic or nationality.

Nikhil Arora

Vice-president and managing director, GoDaddy India

AI ethics: Designing for trust

As artificial intelligence (AI) becomes much more prevalent and increasingly a way of life, more questions are being asked than answered about the ethical implications of its adoption.

Katja Forbes

Founder and chief, sfyte

I didn't know about that. Thanks!

Jamison Herrmann

Twitter 'recap' helps you catch up with missed tweets

Read more

😂😂😂😂😂😂😂😂

Max Polding

What it takes to turnaround an iconic Australian brand

Read more

I spend a lot of time in my professional life as a provider of marketing solutions trying to persuade customers that CX, UX, UI and Custo...

sketharaman

Gartner VP: Why CMOs and CIOs must band together to make CX a discipline

Read more

I live the best deals at LA Police Gear.

Tyrus Rechs

6 Ways to ramp up Social Media to Your Web Design

Read more

Its absolute over priced acquisition. The CEO, must be fired for this all cash transaction. Absolutely no justification for prospective P...

about_face

Analysts question long-term play of SAP's acquisition of Qualtrics

Read more

Latest Podcast

More podcasts

Sign in