Coles stays Australian.

A huge sigh of relief across Australia with the news that Wesfarmers has launched what appears to be a successful bid for the troubled Coles group of companies. Coles is the second biggest employer of people in Australia and it's range of interests is spread across the entire trading spectrum. It is also the second biggest grocery chain in the country - and has a huge impact on petrol sales.
Coles appeared to have lost focus in recent years. There was a perception that it had lost it's way and in the business jungle this made it susceptible to the attention of predators.
It was courted by an American equity company, known for trimming the fat from acquisitions - making them highly profitable - and then on-selling to a third party at a hefty premium. Shudders ran through the business community at a rumour that the end party interested in acquiring the Coles group was the giant American juggernaut - Wal Mart.
Wal Mart is probably the most efficient marketing organization in the world. Unfortunately, everywhere it sets up business it creates a surrounding desert as small business in competition is driven to bankruptcy. Wal Mart is into every form of business under the one roof - and there simply isn't room for anything from a hairdresser to a coffee shop to successfully compete.
The other negative is that if Wal Mart had swallowed Coles then the profits would not have remained in Australia - but would have flowed to America.
Wesfarmers is a much admired Australian institution. Little known in the eastern states until it's hardware chain - Bunnings - opened there and quickly dominated the market by way of savvy marketing and placing the right stores in the right places - it's $ 21 billion bid for Coles puts it in the major league.
Coles share price is currently at $ 16.12 while Wesfarmers is valued at $ 45.73.
There seems little doubt that a Wesfarmers takeover will rejuvenate Coles and promote the clash of titans with it's major competitor - Woolworths.
This is good news for the Australian public - and the profits will remain in this country !