TABCORP – TATTS MERGER: THE BAD NEWS AND THE GOOD NEWS
The A$11 billion merger between Tabcorp and the Tatts Group hit a snag last Wednesday after the federal court ruled that the decision be sent back to the Australian Competition Tribunal. The court decision was as a result of an appeal from the Australian Competition and Consumer Commission (ACCC) and CrownBet.
However yesterday, Justice John Middleton, the president of the Competition Tribunal, granted Tabcorp a speedy re-hearing of its application to approve the merger.
The bad news is that the original timetable set down by Tabcorp and Tatts to execute their merger has blown out.
The dates set down by Justice Middleton (October 24 and 25), fall after a proposed meeting where Tatts shareholders are to vote on the deal, on October 18, and clash with the date by which Tatts hoped to get court approval, October 24.
The meeting and court approval date will need to be rescheduled, Justice Middleton said.
“This is unavoidable because the tribunal must consider all matters that need to be considered now that the matter is back before the tribunal,” he said.
The good news for the mega-merger, which has now been underway for almost a year, is that if the tribunal again approves the deal it will still be possible to “consummate the marriage” before Tabcorp’s offer expires on December 31.
A re-hearing is necessary because of a Full Federal Court finding that an earlier decision by the tribunal waving the deal through with minimal conditions was void due to a legal error.
The court decision left Justice Middleton unsure whether the tribunal had the power to reconsider its original decision.
This morning, he said he had formed the view that he did have the power — but to make sure the process would be bulletproof he suggested Tabcorp make a fresh application, to be heard at the same time as the re-hearing of the original decision.
“We’ve got to proceed as quickly as we can but with all due process,” he said.
He flagged he might restrict the ability of intervening parties, including the James Packer-backed CrownBet, to cross examine witnesses.
“We will endeavour to make a decision one way or another immediately,” he said.
Source: The Australian
