October 24, 2001
Progressive Files New Application With
Commerce Commission
Progressive Enterprises Limited today advised that it had filed an application with the Commerce Commission for a new
clearance to acquire Woolworths New Zealand Limited. The application will be reviewed against New Zealand's recently
tightened competition law as contained in recent amendments to the Commerce Act. It is expected that the outcome of the
application will be known prior to Christmas.
This application will be pursued pending the Progressive appeal to the Privy Council in respect of a previous clearance
in July.
In making the announcement, Progressive Managing Director, Ted van Arkel said, "recent events have excluded our original
clearance from the ten others ratified by the Commerce (Clearance Validation) Amendment Bill, and has delayed the
creation of a more competitive New Zealand supermarket industry. The industry is currently dominated by the three
Foodstuffs co-operatives which have a combined market share of 55% compared to Progressive's share of 21% and Woolworths
New Zealand's share of 19%".
Mr van Arkel continued: "Our vision is for a combined Progressive Woolworths business which will have the strength
needed to compete with Foodstuffs on an equal footing. To this end we are following the Government's recommendation that
we go back to the Commerce Commission”.
"We believe the arguments we will present to the Commission in support of our application for clearance are compelling
and we have filed strong evidence to that effect including independent reports in support of the claim. We expect that
Foodstuffs will use all legal and political tactics at their disposal to oppose our application and frustrate the
clearance process. They will do this for no other reason than it is in their own best commercial interests to preserve
the market power they hold because of their dominant market share, which is unparalleled in any other western
marketplace in the world.
"We will respect the umpire's decision," said Mr van Arkel. "Foodstuffs Auckland, in its submission to the Select
Committee, said they would do likewise. The combined Progressive Woolworths merger would ultimately bring lower prices
to the New Zealand consumer,” he said.
ENDS