New Progressive Commerce Com. Application

October 24, 2001

Progressive Files New Application With
Commerce Commission

Progressive Enterprises Limited today advised that it had filed an application with the Commerce Commission for a new clearance to acquire Woolworths New Zealand Limited. The application will be reviewed against New Zealand's recently tightened competition law as contained in recent amendments to the Commerce Act. It is expected that the outcome of the application will be known prior to Christmas.

This application will be pursued pending the Progressive appeal to the Privy Council in respect of a previous clearance in July.

In making the announcement, Progressive Managing Director, Ted van Arkel said, "recent events have excluded our original clearance from the ten others ratified by the Commerce (Clearance Validation) Amendment Bill, and has delayed the creation of a more competitive New Zealand supermarket industry. The industry is currently dominated by the three Foodstuffs co-operatives which have a combined market share of 55% compared to Progressive's share of 21% and Woolworths New Zealand's share of 19%".

Mr van Arkel continued: "Our vision is for a combined Progressive Woolworths business which will have the strength needed to compete with Foodstuffs on an equal footing. To this end we are following the Government's recommendation that we go back to the Commerce Commission”.

"We believe the arguments we will present to the Commission in support of our application for clearance are compelling and we have filed strong evidence to that effect including independent reports in support of the claim. We expect that Foodstuffs will use all legal and political tactics at their disposal to oppose our application and frustrate the clearance process. They will do this for no other reason than it is in their own best commercial interests to preserve the market power they hold because of their dominant market share, which is unparalleled in any other western marketplace in the world.

"We will respect the umpire's decision," said Mr van Arkel. "Foodstuffs Auckland, in its submission to the Select Committee, said they would do likewise. The combined Progressive Woolworths merger would ultimately bring lower prices to the New Zealand consumer,” he said.

ENDS

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