TABCORP CONFIDENT OF MERGER DESPITE ACCC APPEAL

Tabcorp says it remains confident in its proposed $11 billion merger with Tatts Group, despite a recent legal challenge from the Australian Competition and Consumer Commission (ACCC), which opposes the move.

The  ACCC has applied for a judicial review of the recent Australian Competition Tribunal (ACT)’s decision to approve the Tabcorp-Tatts merger, alleging that the tribunal made three “reviewable errors” in its decision.

The basis of the grounds for review are:

• That ‘detriment’ was only considered if seen to be “substantial” – the ACCC believes this inconsistent with previous decisions and that the Tribunal should take into account any lessening of competition
• The ACCC wishes to review the Tribunal’s lack of consideration of the future state of competition – both with and without the merger
• The ACCC sees there was an error in the weight given to benefits such as cost-savings and revenue synergies, arguing they were to the benefit of Tabcorp and not consumers broadly

Tabcorp, in a filing to ASX last week, said it will oppose the ACCC’s application and will pursue an expedited hearing.

A Tabcorp spokesperson said the application will likely impact the timing of the merger, but said they remain confident that it will be achieved in the last quarter of 2017.

 

Sources: agb.com / Clyde Mooney, editor PubTIC