THE NEWS WRAP: Masters ‘like a start-up’, Woolworths says after $157 million loss

Woolworths has announced it expects losses at its Masters joint venture to reach $157 million for the last financial year, significantly above its initial estimates of $119 million, with a senior executive likening the retail giant’s entry to the $48 billion home improvement market to a new start-up.

“With a new business as a start-up, a lot of these things, including the stock that you need to order, including every single process that we write … including what does the store manager do with the keys at the end of the day … It’s all built from scratch, and so there’s a lot that you don’t know,” Masters chief executive Melinda Smith says.

“We didn’t know a lot about the seasonal curve. We’ve got a great joint venture partner in America [Lowe’s] but when it’s Christmas time over there it’s also winter.

“Our Christmas time lines up with spring and Father’s Day, so it’s quite a different seasonal curve and there’s no doubt there’s a heap of opportunities to better capitalise on that.”

Billabong rejects 11^th hour counter-bid

Troubled surfwear giant Billabong has rejected an 11^th hour counter-bid from hedge funds Centerbridge Partners and Oaktree Capital.

The rejection was partly on the grounds the Cambridge/Oaktree debt-for-equity swap was subject to unacceptable conditions – a claim disputed by the hedge funds.

“Prior to the company entering into the transactions, (it) made numerous requests to Centerbridge/Oaktree to submit a refinancing proposal. Despite these requests, (they) failed to do so,” a Billabong statement says.

NSW Farmers call on Chris Bowen to block GrainCorp takeover

The NSW Farmers annual conference has passed a motion calling on Treasurer Chris Bowen to block the sale of GrainCorp by global agribusiness giant Archer Daniels Midland.

“The deal is also likely to remove [ADM joint venture, agribusiness] Toepfer from the grain-buying market and would impact on domestic processing as a result of ADM’s 16% shareholding in Wilmar, which is the largest shareholder of [food producer] Goodman Fielder,” NSW Farmers Grains Committee chairman Mark Hoskinson says.

“Our members are concerned that ADM’s history in other nations shows cause for concern about how it will impact competition if it was to control 80% of grain-handling facilities in eastern Australia.”

Overnight

The Dow Jones Industrial Average is up 0.5% to 15548.54. The Aussie dollar is up to US91.73 cents.