SYDNEY (Reuters) – Australia’s Wesfarmers said on Tuesday any move to split its budget department store chain Kmart, hardware business Bunnings and chemicals maker WesCEF would push up prices and put the Australian business at a global disadvantage.
An Australian Senate inquiry is considering whether laws should be introduced to make it easier for the competition regulator to force big retailers to sell assets.
“Any breakup would only do two things: it would put our business, the Australian business, at a distinct competitive disadvantage compared to some of the very large global giants such as Amazon (NASDAQ:) and Costco (NASDAQ:),” the CEO said Rob Scott. during the Macquarie Australia conference.
“The second thing that will happen, especially in many areas, prices will rise.”
Australia’s Green Party is pushing for a breakup of the country’s food giants Woolworths and Coles, arguing the companies have worsened the country’s cost of living crisis by jacking up prices.
Woolworths and Coles rejected price gouging and opposed the split proposal, saying the move would put them at a disadvantage to foreign rivals. Both retailers told a Senate inquiry in March that Australia’s grocery sector was highly competitive and had some of the lowest profit margins in the world.
Wesfarmers, which also owns pharmacies, a stationery chain and a lithium mine, has not yet come under scrutiny. The country’s largest listed conglomerate has boosted much of its profits in the past thanks to a property boom and renovations at its market-dominant hardware chain Bunnings.
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