The ACCC will not oppose Coles Supermarkets Australia Pty Ltd, a subsidiary of Coles Group Limited (ASX: COL) acquiring leasehold interests to establish new supermarkets in Victoria at Mt Atkinson Major Town Centre and Deanside Central Town Centre, subject to an undertaking.

The court-enforceable undertaking accepted by the ACCC requires Coles to divest its ownership and interest in a site at the nearby Kororoit Town Centre.

The two proposed acquisitions combined with Coles' interest in the Kororoit site would have meant consumers would have limited choice beyond Coles supermarkets in the relevant local area.

Mt Atkinson, Deanside and Kororoit are all areas close to each other, in the Melton Growth Corridor, northwest of Melbourne. Each of the relevant Coles sites in these areas is suitable for large format supermarkets.

The ACCC had concerns the proposed acquisitions would have the effect, or be likely to have the effect, of substantially lessening competition in the retail supply of groceries and household products within the local markets of each of Deanside Central and Mt Atkinson.

Coles has undertaken to divest the Kororoit site to Neale Deanside Developments Pty Ltd, trading as Oreana, so that it will be available for a competitor to enter the local area. The ACCC has approved this purchaser.

"Without the divestiture undertaking, the proposed acquisitions would have given Coles three supermarkets within close proximity to each other, in local areas with few alternative sites suitable for supermarkets and few existing competitors," ACCC Deputy Chair Mick Keogh said.

"In an area in which Coles already had a significant supermarket presence, we were concerned Coles would control most of the sites suitable for large format supermarkets within 5km of the target sites."

The ACCC was concerned that the proposed acquisitions would significantly increase barriers to entry and expansion for rival supermarkets to enter the relevant local markets.

The ACCC concluded that, absent the divestiture undertaking, the proposed acquisitions would substantially lessen the overall competition in the supply of groceries in the local areas and the broader Melton growth corridor.

"The divestiture ensures that the Kororoit site is available to a rival supermarket operator. It's important that residents of these new suburbs don't suffer from a lack of supermarket competition, as we observed for many established suburbs around Australia in the ACCC's recent Supermarkets Inquiry," Mr Keogh said.

More information is available on the ACCC's public register at Coles - proposed acquisition of a leasehold interest at Mt Atkinson Major Town Centre and Coles - proposed acquisition of a leasehold interest at Deanside Central Town Centre .

Background

Coles operates more than 800 supermarkets nationwide. Coles' large-format stores typically offer standard grocery items, as well as a full-service bakery and deli service. Coles also operates smaller format 'Coles Local' supermarkets with a smaller range of grocery items. Coles operates an online grocery shopping and delivery platform named 'Coles Online', which allows customers to shop for groceries with either home delivery options or pick up from 'Click&Collect' locations at existing Coles stores. Coles Group Property Developments Limited (CGPD) is a wholly owned subsidiary of Coles and was established to support Coles' development operations.

Neale Deanside Developments Pty Ltd, trading as Oreana, is the lessor for the Deanside Central Town Centre located in Deanside, Victoria. Oreana is also a privately-owned Australian property development, construction and investment group.

Mensch Investments No. 3 Partnership is the landholder and developer for the Mount Atkinson Major Town Centre located in Mt Atkinson, Victoria.

The sites at Deanside Central and Mt Atkinson are approximately 3.5km apart and are both located in an area undergoing significant development, known as the 'Melton Growth Corridor'.

On 17 April 2025, CGPD and Coles entered into a sale agreement and an agreement for lease with Oreana, pursuant to which CGPD would transfer its freehold interest in the Kororoit site to Oreana and CSA would take a leaseback of a developed supermarket at the site.

The undertaking to divest the site at Kororoit ensures that CGPD divests the site to Oreana by no later than 31 July 2026 and CSA terminates the Agreement for Lease with Oreana.

ACCC Supermarkets Inquiry

On 21 March 2025, the ACCC published the Supermarkets Inquiry final report. In it the ACCC made a number of findings relevant to how it will assess supermarket acquisitions, including under the mandatory merger regime commencing 1 January 2026, including acquisitions of land. The Inquiry noted that the supermarket industry is highly concentrated with Coles and Woolworths accounting for approximately 67% of share of supply in Australia. The ACCC also found the availability of suitable sites for supermarket retailers is a likely impacted by planning and zoning laws and Coles and Woolworths have advantages over other retailers in securing such sites.

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(C) 2025 M2 COMMUNICATIONS, source M2 PressWIRE