Di Pilla consortium in play for Masters as Woolworths enters trading halt

UBS banker Matthew Grounds and Greg Hayes are believed to be joining Chemist Warehouse and Spotlight in the bid.

A consortium of wealthy families is said to be on the hunt for Woolworths’ Masters hardware portfolio. (Brendan Radke)

Veteran banker David Di Pilla is understood to be leading a consortium of wealthy families to buy Woolworths’ Masters hardware portfolio.

The consortium includes investors Greg Hayes and legendary banker Matthew Grounds, who heads up UBS’s operations in Australia. Chemist Warehouse and Spotlight are also part of the group.

Mr Di Pilla, who is married to a member of Sydney’s wealthy Salteri family, is believed to have injected some of his personal wealth into the transaction, as have Di Pilla’s parents-in-law, Mary and Alex Shaw. The planned acquisition of the Masters business has been backed by two other unnamed high net worth families, as reported on The Australian’s BusinessNow blog.

It is understood the private consortium has already lined up a follow-on deal with Masters’ arch rival, Bunnings, with between 10 and 20 of the large format stores likely to be leased to the hardware retailer. A number of the properties have also been earmarked for redevelopment.

Mr Hayes and Mr Grounds are also investors in the Aurrum aged care venture, which Di Pilla founded two years ago. The business now operates seven aged care facilities in New South Wales and Victoria and owns three greenfield sites.

The developments come after DataRoom exclusively revealed that Metcash was finalising contracts on Tuesday night to buy Home Time and Hardware from Woolworths, with the price expected to be between $150m and $200m. Metcash has since announced to the market that it is purchasing the hardware chain from Woolworths for $165m.

It is understood that Anchorage also bid close to the same valuation as Metcash and this has raised questions in some quarters about the synergy value Metcash will extract from the deal.

Following reports of Metcash’s purchase, Woolworths shares were placed in a trading halt on Wednesday morning, pending an announcement on its home improvement joint venture business, which includes both Masters and HTH.

Sources said Wednesday morning that with HTH being immaterial to Woolworths, a deal involving Masters could also be announced.