GERMAN supermarket giant Kaufland is withdrawing from the Australian market, scuttling plans for a new supermarket in Warrnambool.
The company said in a statement on Wednesday that it was concentrating on its European core markets for "the foreseeable future".
Kaufland International acting chief executive officer Frank Schumann said the decision was not taken lightly.
"We always felt welcome in Australia. We would like to thank our employees and we apologise for the disruption this decision will cause," Mr Schumann said.
The company had plans for a new 4000 square-metre supermarket at 69-83 Raglan Parade on vacant land near a motel in the city's east.
It had said the development would create 100 new jobs.
Kaufland Australia managing director Julia Kern had said just five months ago the company was "committed to our long-term sustainable growth across Victoria."
Civic leaders had welcomed Kaufland's interest with Warrnambool City Council chief Peter Schneider saying in August it was "encouraging".
Councillors unanimously voted in October to refer the project to a state government appointed planning panel.
Kaufland then submitted a city council planning scheme amendment for the site in late October and was seeking flexibility in the council's Eastern Activity Centre Structure Plan amendment for the new supermarket.
In its statement on Wednesday Kaufland said the future of the company's existing Australian investments would be discussed with the parties involved in coming days.
It was set to open 11 new stores in Victoria, also including one in Kennington near Bendigo. Overall it had plans to establish up to 30 Australian stores and had 200 employees nationally.
The company clarified that its decision to focus on the European market was "in no way" connected to the efforts of its employees, management or the support from the Australian business community or governments.
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