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In a move that surprised nobody but simply confirmed popular speculation, Australia’s biggest retailer Woolworths has said that it is interested in acquiring some of the nonfoods assets – such as office supply and discount store operations – from Coles, the nation’s second largest retailer.

Coles has been very much in play in recent weeks, with much speculation about possible bids from the likes of Tesco or Wal-Mart.

There already has been a bid worth the equivalent of 16 billion (US) from Wesfarmers, Australia's biggest home-improvement retailer, and a consortium of buyout firms. That bid reportedly was eight percent higher than an earlier offer from a KKR-led consortium led by Kohlberg Kravis Roberts (KKR) that was made and rejected by Coles last October. The KKR consortium, however, reportedly is still in the hunt.
KC's View:
We got a wonderful email the other day from an Australian who is a member of the MNB community, pointing out that there are some interesting coincidences in all the attention that Coles is receiving. Among the observations…

Roger Corbett, the recently retired CEO of Woolworths, is on the Wal-Mart board of directors, and former Wal-Mart executive Jack Shewmaker serves as an adviser to the Woolworths board.

According to our correspondent, it also is interesting that KKR’s consortium includes private equity firms Bain Capital & TPG. Bain Consulting, like Bain Capital, is part of the Bain Group, has worked with Woolworths in the past, while TPG is part of the group that owns Myer department stores, which was only spun off from Coles last year.

It all sounds complicated and slightly incestuous to us…but it’ll be interesting to see how it all turns out.