The Australian Competition and Consumer Commission (ACCC) has determined that Coles Group Limited’s proposed acquisition of a lease for a supermarket and liquor store development in Kalgoorlie, Western Australia, requires an in-depth Phase 2 merger review.
The decision follows the ACCC’s Phase 1 assessment, in which the Commission did not approve the acquisition. As a result, the transaction cannot proceed unless it is cleared following a Phase 2 review.
The acquisition concerns a lease over a vacant site in Kalgoorlie, where Coles proposes to develop and operate a large-format supermarket and an associated liquor store. Coles already has a significant presence in the local market, operating one supermarket and three Liquorland liquor stores in the area.
According to the ACCC, the proposed acquisition raises competition concerns in relation to the retail supply of groceries in Kalgoorlie. ACCC Deputy Chair Mick Keogh stated that the transaction could substantially lessen competition in the local grocery market.
“The acquisition is likely to provide Coles with a significant market share for the retail supply of groceries in a local market where competitive constraint from rival supermarkets may be limited and timely new entry may be unlikely,” Mr Keogh said.
The ACCC is also examining whether the acquisition may create, strengthen, or entrench Coles’ substantial market power in the local market. While concerns have been identified, the Commission has emphasised that it has not yet reached a final conclusion and will continue its assessment during Phase 2.
“We believe this acquisition needs an in-depth assessment to understand the likely impact it will have on competition in Kalgoorlie,” Mr Keogh said, adding that the ACCC will engage with additional industry participants and interested parties as part of the review process.
This is the first acquisition assessed by the ACCC since the introduction of additional targeted notification requirements for Coles and Woolworths, which were determined by the Assistant Minister for Competition.
Regulatory Background
Coles Group Limited is an Australian publicly listed company (ASX: COL) operating supermarkets and retail liquor stores nationwide. The lessor, M Holding 4 Pty Ltd, is a privately owned Australian company specialising in residential and commercial property sales, management, and development in Western Australia.
From 1 January 2026, Australia’s merger control regime requires mandatory notification to the ACCC for acquisitions that meet ministerially set thresholds, with parties prohibited from completing transactions without prior ACCC approval. Once notified, transactions are published on the ACCC’s Acquisitions Register, and stakeholder consultation is initiated.
Under the regime, the ACCC has between 15 and 30 business days to complete a Phase 1 assessment, subject to extensions. Where the ACCC is satisfied that a proposed acquisition could substantially lessen competition, it may refer the matter to a Phase 2 review, which can take up to 90 business days under the Competition and Consumer Act, unless extended.
In addition to the general notification thresholds, from 1 January 2026 Coles and Woolworths are subject to targeted notification requirements covering all supermarket business acquisitions and land acquisitions exceeding specified size thresholds, regardless of whether general thresholds are met.
Although these additional requirements were not yet in force at the time, Coles voluntarily notified the Kalgoorlie acquisition under the formal merger review regime prior to 1 January 2026.