http://www.themercury.news.com.au/common/story_page/0,5936,4383943%5E462,00.html --------------------------------------------------------------------- Coles draws veil over bank plans --------------------------------------------------------------------- 25may02 --------------------------------------------------------------------- COLES Myer appears close to realising its long-held ambition to join the banking ranks by forging a strategic alliance with either Westpac or HSBC Group. --------------------------------------------------------------------- The retail group's executives remained tight-lipped yesterday, apart from one spokesman saying: "We have said that financial services is on our strategic horizon." "Broadly speaking, Coles Myer is always looking at different opportunities in the market place." --------------------------------------------------------------------- Coles Myer signalled its intentions more than three years ago when it rolled out banking kiosks providing financial services and products. --------------------------------------------------------------------- Woolworths had an exclusive arrangement with the Commonwealth Bank through Ezy Banking, which drew more than 200,000 new customers to the bank. --------------------------------------------------------------------- Shaw Stockbroking analyst David McDonald said an alliance with a bank made a lot of sense for Coles Myer. --------------------------------------------------------------------- "There are a lot of synergies if Coles Myer and Westpac were to align with each other. --------------------------------------------------------------------- "Coles Myer has had other partners in the past and it looks like they want to consolidate that." --------------------------------------------------------------------- Already 14 million people pass through Coles Myer stores around the country each week with its 608 Coles/Bi Lo supermarkets and 73 Myer Grace Bros stores. --------------------------------------------------------------------- A Westpac spokesman declined to comment on the speculation. --------------------------------------------------------------------- If the deal went ahead, it was believed the financial products offered to the Coles Myer customers would feature the Coles brand. --------------------------------------------------------------------- The deal would also fit in with Westpac's plans to drive its growth organically in Australia and New Zealand and would give it access to Coles' massive customer base. --------------------------------------------------------------------- Earlier this month Westpac sealed a $1.65 billion deal to sell its consumer finance arm AGC to GE Capital, which funds and manages Coles' store-card program. --------------------------------------------------------------------- Westpac also recently bought Rothschild Australia Asset Management for $323 million. --------------------------------------------------------------------- HSBC was keen to grow organically in Australia and had been reported as a possible acquirer of St George Bank when its 10 per cent shareholder cap expires on July 1, leaving it open to takeover. --------------------------------------------------------------------- Coles Myer stocks were two cents higher at $6.52 at 1442 AEST, while Westpac was steady at $16.28. ---------------------------------------------------------------------
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