FILE PHOTO: Shoppers walk into a Woolworths supermarket in Sydney, Australia August 22, 2017. REUTERS/Jason Reed

(Reuters) - Australia's largest supermarket operator Woolworths Group WOW.AX said on Monday its shareholders have approved the first stage of a plan to combine and spin off its drinks and hospitality businesses.

Woolworths said in a statement that 99.5% of its shareholders had voted in favor of the first stage of the restructuring, which paves the way for the combination of the Endeavour Drinks and ALH Group businesses.

The company said the combined entity would eventually be separated through a demerger or other “value added alternative”. It expects the merger of the two businesses to take place on February 2, 2020.

Woolworths, which is currently embroiled in a lawsuit for underpaying thousands of supermarket workers, revealed its divestment plans in July with an aim to focus more on its core business.

The company said that if a separation of Endeavour Group takes place through a demerger, it intends to maintain a 15% shareholding in the new firm.