The move comes as no huge surprise and comes almost sixteen years on from when Target was acquired by Westfarmers as part of the Coles Group Limited acquisition in November 2007.
Since then, both Target and Kmart have operated together, but separately.
It is expected that there will be a "handful of redundancies" but the decision was one of "strength, not weakness."
"Kmart and Target are both strong businesses. I don't see us doing this from a position of weakness. It's quite the opposite. I'd say we're strong, but I think there's an opportunity to really capitalise on this time and find ways to continue to deliver better value for customers," Ian Bailey told the Australian Financial Review.
"What we found was that running two businesses it was very, very difficult to get into Target, and to get those benefits. This is really why we decided to push the two businesses into one."
But not to fret!
From a shoppers' perspective, nothing will be changing, with both stores retaining their names and remaining separate.
Kmart will continue to be a price-drive retailer whilst Target will continue to focus on affordable apparel and soft home furnishings.
Speaking with news.com.au Queensland University of Technology leading retail expert Dr. Gary Mortimer said that the "folding" of Target would provide "better prices" and a "better range of offers" for consumers.
"If you want everyday low prices," you'll head to Kmart," Dr Mortimer said.
"If you want a better quality, better value offer, you'll go into a Target store."