Company News Summary
Woolworths Announces to Sell Fuel Business and Enters Strategic Partnership with BP
Original announcement: Sale of Fuel Business and Strategic Partnership
Woolworths announced that it has entered binding agreements to facilitate the sale of its 527 Company-owned fuel convenience sites and 16 committed development sites (Fuel Business) to BP for $1.785bn. As part of the Fuel Business divestment, The Company and BP plan on entering a long-term strategic partnership. The sale of the Fuel business is not expected to have a material impact on the Group earnings. The Fuel Business incurred an operating lease rental expense of $70m in FY16. In order to preserve and expand the 4cpl fuel discount offer, which is a key component of the Company's loyalty offering, the parties will enter into a minimum 10-year Redemption Agreement. The sale transaction and the Strategic Partnership are subject to customary closing conditions.
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