Showing posts with label m. Show all posts
Showing posts with label m. Show all posts

Thursday, December 20, 2007

Commerce Commission impacts on The Warehouse' bottom line

The future of The Warehouse Group [WHS.NZ] is on hold, after the Commerce Commission announced earlier this week that they are going to appeal the High Court decision to the Court of Appeal to allow Foodstuffs and Woolworths Australia [WOW.ASX] bidding for the retailer.

Unless the Commission can argue new evidence in the higher court or argue on a technicality on a point of law then their appeal is not likely to be a positive one for them.

The Commission also face the distinct possibility that their appeal maybe thrown out before it begins at a preliminary hearing, due to sit on January 29 to decide whether leave to appeal will be granted.

Warehouse management have publicly backed the two bidders so it shows the direction the company wants to go.

The Commerce Commission clearly see the High Court decision to allow the two Warehouse suitors to bid as a watershed decision that must be fought with all their state backed muscle.

Personally, like most state apparatus and workers within those apparatus, there is a little bit of self preservation involved. In the Commission's decision to appeal we have a little job justification going on and any brakes on the growth of a business like The Warehouse, while they have to wait, and they have waited for over a year because of the CC dilly dallying, is purely incidental to those at the Commission.

It is outrageous that the state can take such a lengthy time to make such an important decision over the property rights of Warehouse shareholders. While it is understandable that there will be competition issues in business from time to time and these should be arbitrated, it is even more serious an issue when arbitration of these issues materially affects an important business because of unnecessary delays, not to mention the negative impacts to those individuals and groups who own that business.

The Commerce Commission should take the lay of the land and come to the conclusion that much wiser heads at the High Court did, that the Warehouse and its current owners need to be able to freely sell an asset that is theirs, to two willing buyers that want it.

The millions of dollars that it has cost The Warehouse so far since their business has been on hold is a serious issue and the strangle that the Commission has on its business at present must be let go so the losses don't continue to mount.



Disclosure: I own WHS shares



The Warehouse Group @ Share Investor

Long vs Short: The Warehouse Group
Warehouse bidders ready to lay money down
The Warehouse set to cut lose "extra" impediment
The Warehouse sale could hinge on "Extra" decision
The case for The Warehouse without a buyer
Foodstuffs take their foot off the gas
Woolworths seek leave to appeal to Supreme Court
Warehouse appeal decision imminent
Warehouse decision a loser for all
Warehouse Court of appeal decision in Commerce Commission's favour
MARKETWATCH: The Warehouse
The Warehouse takeover saga continues
Why did you buy that stock? [The Warehouse]
History of Warehouse takeover players suggest a long winding road
Court of Appeal delays Warehouse bid
The Warehouse set for turbulent 2008
The Warehouse Court of Appeal case lay in "Extras" hands
WHS Court of Appeal case could be dismissed next week
Commerce Commission impacts on the Warehouse bottom line
The Warehouse in play
Outcomes of Commerce Commission decision
The fight for control begins soon

Share Investor Forum-Discuss this topic


Related Links

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

The Wal-Mart Effect: How the World's Most Powerful Company Really Works--and How It's Transforming the American Economy by Charles Fishman
Buy new: $10.20 / Used from: $8.50
Usually ships in 24 hours


c Share Investor 2007 & 2009