SYDNEY, Jan 18 (Reuters) - Australia’s No. 1 grocery chain Woolworths Ltd said on Monday it planned to sell or wind-up its stake in the hardware unit ‘Masters’ due to ongoing losses, ending months of speculation about the potential sale.
Masters is a joint venture with U.S.-based Lowe’s Companies Inc, and Woolworth’s budget general merchandise chain, Big W.
“Our recent review of operating performance indicates it will take many years for Masters to become profitable,” said Woolworths Chairman Gordon Cairns in a statement to the stock exchange.
“We have determined we cannot continue to sustain ongoing losses from this business,” he said, adding the exit process would take several months.
Woolworths’s share price jumped more than 6 percent, though it was still showing a decline of 23 percent for the past 12 months.
Woolworths has been battling a step-up in competition brought about by new entrants such as Aldi, contributing to three profit forecast downgrades last year. (Reporting by Cecile Lefort; Editing by Eric Meijer)
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