Bunnings v Metcash: $60m on tradie tools
Shortly after Bunnings revealed it was to introduce a new network of trades-focused equipment outlets under a new brand, Metcash informed its financiers that Total Tools will certainly undergo its own plan for growth.
Metcash will have an 85 per cent stake in Total Tools, less than a year after buying its first 70 per cent share for $57 million. Metcash has the option to purchase the 100 per cent within three years.
Total Tools has assigned $25 million for a network expansion of stores, which is presently 90 across the country.
Metcash said on Monday that they see significant growth opportunities for Total Tools and this investment will help with Total Tools expansion plan.
The deal comes less than a month after Bunnings revealed plans to utilize Adelaide Tools, which it acquired in 2020, as the basis for a new tool chain that will concentrate on the trade market.
Concerned that trades have actually dismissed its hardware brand, Bunnings prepares to utilise a new name to gain a bigger piece of the this professional market. Bunnings is yet to decide on a name for their new chain.
Bunnings, which has more than 260 of named stores throughout Australia, wants to open a further 75 stores under its new brand name within in a couple of years.
South Australia has all six of the current Adelaide Tools stores.
To counter Bunnings, Metcash wants to open to 10 Total Tools every year until 2025, increasing the store numbers to 130. An upgrade to the existing stores is also currently underway.