One to watch this week.
The Warehouse[WHS.NZX] takeover saga continues Tuesday 28 April (NZ Time) with the Court of Appeal case, and runs for a further 3 days. There will be no immediate decision, with weeks more to wait, well, we have waited nearly 2 years so far, and the likelihood that Foodstuffs and Woolworths Australia [WOW.ASX] will be able to make a bid looks more likely than not.
The Commerce Commission(CC), who are appealing against the affirmative decision in the High Court last year, have struck it lucky to some extent, with spiraling food prices making emotive headlines all over the place but it any judge worth his pay packet will look past this temporary wave of bio fuel inspired food inflation and make a fully emotionless decision.
The CC have a wafer thin case and any new arguments for their case will probably pin themselves on the possibility that The Warehouse and its "Extra" food format will be a serious player sometime in the distant future.
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Unlikely given that The Warehouse itself has largely lost interest in the concept itself.
While many may groan when I mention government interference halting the other long running takeover saga, the Auckland Airport bid by the Canadians, this writer wouldn't put anything past New Zealand's socialist government putting their sticky mitts into this deal, should the Court of Appeal case come down in The Warehouse favour.
Whatever the machinations maybe in our courts this week, the outcome will be closely watched and a positive outcome for The Warehouse will be a serious shot in the arm for our local stockmarket, given its rather stagnant showing over the last 6 months.
Many shareholders will reinvest the collective north of NZ$ 2 billion proceeds of a sale in other shares on the NZX.
Keep watching here for further updates on this story.
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The Warehouse Financial Data
Related Amazon reading
The Wal-Mart Effect: How the World's Most Powerful Company Really Works--and How It's Transforming the American Economy by Charles Fishman
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