BP exits deal with Woolworths, retail firm looks out for alternatives
Category: #retail  By Saipriya Iyer  Date: 2018-06-23
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BP exits deal with Woolworths, retail firm looks out for alternatives

BP Plc, a UK based oil & gas firm, has decided to terminate its USD 1.8 billion acquisition deal with Australian retail giant Woolworths. For the record, the British oil & gas company had signed a pact to purchase Woolworths’ 543 fuel & convenience stores in December 2016.

Reportedly, in August last year, ACCC (Australian Competition & Consumer Commission) had blocked the acquisition deal citing the reason of reducing competition and making motorists pay more for petrol. However, Woolworths & BP had promised to continue with the agreement, alleging ACCC of damaging its evaluation of the country’s fuel sector.

For the uninitiated, currently there are 1400 BP-branded stores in Australia, with nearly 350 of them owned by the UK based firm and the rest owned by independent operators. Woolworths Group announced that it is now looking for other alternatives for expanding its petrol business, since BP pulled out of the contract.

Apparently, Woolworths carries out its service station business operations in association with Caltex, a petroleum major and BP’s arch rival. Sources claim that the Australian retailer is eager to divest from its fuel business activities and use the proceeds to fund its supermarket store chain to compete against Coles, another Australia based supermarket, retail, and consumer services chain.

Andy Holmes, CEO, BP, APAC, has stated that the firm had tried every option to convince ACCC, including the sale of a substantial number of its fuel outlets as well as changing the structure of its proposed agreement with Woolworths. He again asserted that none of the alternatives suggested by the firm to the Australian competition watchdog proved to be successful.

Mr. Holmes announced that BP will continue with its convenience strategy in Australia, which it hopes to achieve via lucrative collaborations with companies boasting of an efficient food supply chain.



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Saipriya Iyer

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Saipriya Iyer

Saipriya Iyer develops content for Market Size Forecasters, Algosonline, and myriad other platforms. A computer engineer by profession, she ventured into the field of writing for the love of playing with words. Having had a previous experience of 3 years under her bel...

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