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Woolworths to enter $24bn hardware sector

The Board of Woolworths Limited (Woolworths) has announced plans for the company to enter the $24bn plus hardware sector.

The retailer is considering a recommended takeover offer for Danks Holdings Limited (Danks).

Danks is Australia’s second largest hardware distributor supplying 583 Home Timber & Hardware, Thrifty-Link Hardware, and Plants Plus Garden Centre stores plus 939 independent hardware stores.

If the bid is successful, it is said to result in the development of a network of destination home improvement stores with a target to secure more than 150 store sites within the next five years.

Woolworths has also announced a joint venture equity agreement with leading US Home Improvement retailer Lowe’s Companies Inc (Lowe’s).

Woolworths Chief Executive Michael Luscombe said the move is a real opportunity to increase the overall size of the sector and said the company’s investment should be positive for both customers and the industry alike.

“We’re interested in adding choice to the industry and we believe we can improve the pricing, product range and experience for customers,” Luscombe said.

“At the moment, the sector is dominated by one major big box player, so there is a real opportunity for increased competition in that part of the sector,” he added.

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