Caltex has shored up its post-Woolworths future with the competition watchdog approving its takeover of Victorian fuel retailer Milemaker Petroleum.
The Australian Competition and Consumer Commission (ACCC) was initially concerned the $95 million deal could lessen competition in Melbourne, where most of Milemaker's 46 service stations are located.
ACCC chairman Rod Sims on Thursday said it was a difficult decision as competition will be reduced, any impact should be limited.
"However, the small size of Milemaker and limited direct competitive overlap with Caltex led the ACCC to conclude that the effect on competition is not likely to be substantial," he said.
The Milemaker Petroleum buy - expected to be completed next week - is Caltex's second acquisition since it lost out to BP in a bid for Woolworths fuels' business in December.
Caltex chief executive Julian Segal said Woolworths was the company's largest customer, representing 20-25 per cent of its fuel volumes.
He said analyst forecasts of potential losses of $100-$140 million from the Woolworths' business were reasonable.
But even so, he told shareholders at its annual general meeting on Thursday, the impact will not be lasting.
"We see the Woolworths' decision as a short-term setback for Caltex," he said.
"We are confident that we will be able to close any earnings gap on a run rate basis by the end of this year, and will do so in a disciplined and sensible manner."
He said the group's plan to mitigate any loss from the Woolworths decision include the Milemaker and Gull New Zealand acquisitions and its transformation from being just a leading transport fuels provider to include a larger convenience retail offering.
Chairman Greig Gaily said the BP acquisition was subject to regulatory approval, which was unlikely before early 2018.
Meanwhile, Caltex said, it will continue to supply Woolworths.
Caltex shares were up 28 cents, or 0.9 per cent, at $30.80 at 1228 AEST.
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