Money Woolies looks to offload petrol stations

Woolies looks to offload petrol stations

Woolworths sells petrol business to BP
Woolworths will use the proceeds of the sale to offset its losses from the Masters venture. Photo: AAP
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Struggling retailer Woolworths is looking at offloading its petrol stations not long after striking deals to rid itself of its loss-making hardware business.

The supermarket giant confirmed that is it considering selling its petrol stations and is discussing a possible deal with several interested parties, reportedly including partner Caltex.

This comes a month after Woolworths sold Home Timber and Hardware to Mitre10 owner Metcash and announced it would shut all Masters stores by December 11 with the properties to be sold to a consortium that wants to turn them into retail centres.

Woolworths said it was evaluating whether to retain or dispose of its service stations, and no decision had been made.

“Woolworths has received incomplete and conditional proposals from a number of parties in relation to the purchase of the business, and the development of an enhanced convenience and loyalty offer to customers,” the company said on Friday.

Bell Direct equities analyst Julia Lee said Woolworths’ newly installed chief executive Brad Banducci was clearly striving for a leaner company focused on turning around the group’s core food and grocery business.

“The supermarket business is in its early stages of a turnaround plan and it is capital intensive,” Ms Lee said.

Caltex has declined to comment on reports that it is negotiating a $1.5 billion deal to buy Woolworths’ petrol business, which encompasses 530 service stations that generated $4.6 billion in sales in 2015/16.

The service stations are owned by Woolworths and are supplied petrol and diesel by Caltex.