Coles Myer media relations spokesman Scott Whiffin contacted The Leader at 7pm yesterday, as the paper neared its production deadline, with a letter written by Coles Myer chief executive officer John Fletcher.

The letter, which was addressed to the mayor of Tamworth, James Treloar, council's general manager Phil Lyon and Member for Tamworth Peter Draper indicated that negotiations were well advanced to develop one of the largest Target retail stores in inland Australia.

Mr Fletcher's letter said: "I am writing to you about Coles Myer's future commitment to Tamworth following the closure of our Grace Bros store on June 22.

"We have been in negotiation for some months with the owner of the building [Randon and Glen Ilic, of Ranglen investments, Sydney] now occupied by Grace Bros and had hoped to be in a position to announce to the community firm details of our plans before our announcement of the Grace Bros closure.

"However, while negotiations with the owner are well advanced for a very

substantial new Target store, their finalisation is dependent on the successful outcome of ongoing discussions with council.

"At this stage we envisage the development of one of the largest regional Target stores in Australia, employing an estimated 80 people in full-time, part-time and casual jobs.

"In drawing up these plans we have recognised the Tamworth community's desire for a regional shopping

destination.

"While we recognise the community's disappointment about the closure of Grace Bros we are always obliged to find a solution which meets the needs of both our shareholders and our customers.

"We believe we will have achieved that when our plans come to fruition," Mr Fletcher wrote.

The Save My Store Grace Bros Tamworth Action Group spokeswoman, Evelyn Parkinson regarded the last-minute announcement with cynicism.

"If they can put those energies into establishing a large Target store in Tamworth, why can't they keep the Grace Bros store?" she said.

She said the action group's aim was to maintain the quality of shopping that Grace Bros offered and the rally today would continue to call for the store to remain.

"Our action group's commitment is to keep Grace Bros as it stands," Mrs Parkinson said.

"We don't want the standard of shopping lowered at all.

"We don't want to be treated as second-class citizens.

"Shoppers at Grace Bros want to be able to buy the same sort of things in Tamworth that can be bought in Sydney."

Mrs Parkinson said country music star Sara Storer had contacted her yesterday afternoon to throw her support behind the action group.

"Sara had been on holidays and come back to find our request for support on her e-mail," Mrs Parkinson said.

"She couldn't make the rally at such short notice but said she was willing to help the cause in any way she could."

Tamworth mayor James Treloar welcomed the news, however he emphasised that he'd not had any discussions with Mr Fletcher.

However he said any proposal Coles Myer had for the store would be met "very favourably" by the council.

Mr Treloar said he had an appointment to meet the owners of the store next Monday at noon.

Member for Tamworth Peter Draper said Coles Myer's actions were "applaudable".

"Coles Myer are making their plans transparent but the issue is the difference between the two stores," Mr Draper said.

"Grace Bros is an icon. I seriously doubt Tamworth [with the mooted Target store] will have the same appeal to people in farther-flung areas looking for the kind of shopping that Grace Bros offers.

"A lot of people want something a bit special, which they can obtain at Grace Bros but not at Target."

Mr Draper suggested that Coles Myer might consider a department within the Target store to cater for discerning shoppers.

However Mr Draper said he was not about to knock the Target proposal if the Grace Bros decision was irreversible. "It's all about employment," he said.

Target and Country Target have almost 260 outlets in Australia.

The Coles Myer spokesman indicated the smaller Country Target store in Peel St would be closed and absorbed into the larger store if the Target proposal went ahead.

Mr Fletcher was unavailable for comment.