WESFARMERS MAKES BID FOR AUSTRALIAN RETAIL GIANT COLES.

SYDNEY, July 2 Asia Pulse - Wesfarmers Ltd (ASX:WES) is set to become the biggest retailer in Australia, after making a A$22 billion bid (US$18.8 billion) for Coles Group Ltd (ASX:CGJ), the largest takeover in Australian corporate history.

Ending months of uncertainty, Wesfarmers today announced a A$21.9 billion cash and share offer for the supermarket and general merchandise empire, with the support of the Coles board.

The takeover, valuing Coles shares at A$17.25 a share, would catapult Wesfarmers into the top 10 Australian listed companies.

Wesfarmers managing director Richard Goyder said the takeover represented an opportunity for Coles shareholders to hold onto an ongoing interest in the company, for Coles to stay Australian-owned, and for staff and consumers to benefit from a revitalised major force in retailing.

"The recommendation from the Coles board is a big step towards helping end the uncertainty for shareholders, employees, suppliers, and customers surrounding the company's ownership review," Mr Goyder said.

Coles shareholders would receive a premium for their shares under the bid, an anticipated increase in annual dividend income and the prospect of capital gains tax rollover relief for a substantial proportion of their shareholding, Wesfarmers said.

Under the bid, to be carried out by scheme of arrangement, Wesfarmers is offering A$4 cash and 0.2843 Wesfarmers shares for each Coles share.