Lowe’s files lawsuit to prevent Woolworths from selling Masters Home Improvement
Woolworths elicited public interest when it announced on Monday its fire sale in which it disposes all inventory through hefty discounts before it sells Masters Home Improvement. But it also incurred the ire of US hardware giant Lowe’s, its partner in Masters.
The Australian reports that Lowe's has filed a lawsuit against Woolworth’s plan to sell Masters for $15 billion. Lowe's accuses Woolworths of oppressive conduct and acting in bad faith for the planned closure of the hardware in just more than three months. It also hit the rush meeting held by the Masters’ directors last week when Woolworths officials attempted to speed up the disposal of Masters during a break to meet the supermarket giant’s full-year results announcement.
On Monday, Lowe’s lawyer asked Federal Court Judge Lindsay Foster to liquidate the Masters joint venture. However, Woolworths executives were not aware of Lowe’s legal moves and have not received any legal paperwork. For almost eight months, the two were negotiating for the buyback of Lowe’s one-third stake in Masters.
However, Woolworths got the support of David Di Pilla, former investment banker and the brains behind the consortium of private investors which plan to purchase 82 Masters outlets for $750 million. Di Pilla says what Lowe’s did was just an attempt to squeeze more money from Woolworths.
WAToday reports that shoppers who went to the Masters fire sale in Bayswater on Monday were found that the Masters discounts were similar to the recent Dick Smith fire sale instead of a do-it-yourself haven as they were expecting.
Clare Bell, a shopper, describes the discounted items as rubbish and predicts Masters would not be able to sell a lot of the products at those prices. Woolworths said on Monday the price cut would be around 30 percent, but the website cites as store employee who said the price cuts were only between 6 and 10 percent.
VIDEO: Woolworths – Masters Stores are closing in Australia by end of the year 2016
Source: News Update 24/7
