Federal Court Justice Peter Jacobson ruled on Tuesday in favor of Metcash's and Pick n Pay's planned purchase of supermarket chain Franklins for $250 million because the transaction would not violate the country's anti-trust laws.

The decision denied an appeal from the Australian Competition and Consumer Commission (ACCC) for an injunction to block the sale. Besides the ACCC, independent retailers also opposed the buy-in by Metcash of Franklins because the retailers want to keep Metcash in the wholesale business, not retail.

Metcash is Australia's largest wholesale grocer with 80 outlets in New South Wales and the Australian Capital Territory and supplies groceries to 10 franchised stores.

The ruling paves the way for the court to hear the sale of Franklins on Oct. 24 through Oct. 27.

Despite ACCC's loss, ACCC Chairman Rod Sims said the agency remains committed to the appeal process.

The ACCC earlier warned other retailers such as Coles and Woolworth that it would be monitoring their moves to buy other independent grocers.

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