US retailer Lowe’s has begun Federal Court action against Woolworths over the failed Masters hardware chain.

Lowe’s lodged a motion in the court in Sydney accusing Woolworths of wrongfully attempting to terminate the joint venture (JV) formed by the pair in 2009, and is asking the court to appoint a liquidator to oversee the wind-up of Masters.

“Woolworths has engaged in oppressive conduct, including by invalidly and in bad faith attempting to terminate the JV,” a statement from Lowe’s said on Monday.

The statement said Lowe’s was left with no other option but to take the matter to court “to achieve an equitable and orderly wind-up” of Masters.

Lowe’s owns one-third of the company it created with Woolworths, called Hydrox Holdings.

It also accused Woolworths of seeking to exclude Lowe’s from the management of Hydrox.

Woolworths announced on Wednesday that it will shut all Masters stores by December 11.

It said Home Consortium, which includes the companies behind retailers Spotlight and Chemist Warehouse, had bought 61 stores and 21 development sites with plans to convert the Masters buildings into shopping centres.

Lowe’s is listed on the New York stock exchange and owns home improvement chains in the US, Canada and Mexico.

Update: August 29 16:00 AEST

Following the news that broke earlier today, Woolworths released the following statement:

Woolworths Group confirms that today it became aware of an ex parte application filed by Lowe’s in relation to the home improvement joint venture company, Hydrox Holdings Pty Ltd. Woolworths is yet to be served with documents relating to this application. The transactions relating to the Home Timber and Hardware sale and Masters’ inventory clearance by GA Australia are proceeding as announced.

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