The Australian Competition Tribunal has extended the deadline to make a ruling on the long-awaited merger between Tabcorp and its rival operator Tatts Group. The Tribunal was scheduled to make its ruling on the A$6.4-billion merger by June 13th, but instead, the two parties’ investors will have to wait for three more month before they get some clarity on the matter.
The Australian Competition Tribunal has the right to extend the deliberation period only once, so it chose to prolong it with the maximum of three months until September 10th. Still, the Tribunal, which has been holding hearings related to the merger proposal, has the right to deliver a decision before that date.
An agreement for the deal was reached back in October 2016, when Tabcorp said it would acquire Tatts Group in order to become more competitive in the constantly expanding market, especially in terms of its rivals that operated under international licenses. However, the deal has faced strong objection from some domestic gaming operators.
As Casino Guardian reported at the beginning of the week, the fate of the deal still remains unknown. The deal has been opposed by the Australian Competition and Consumer Commission (ACCC), according to which the merger raised some concerns. ACCC said that the deal was very likely to significantly increase the market power of Tabcorp and even hurt competition in the region.
One of the major concerns of the merger proposal opponents is related to the racing broadcast business of Tabcorp – Sky Racing. According to the merger’s critics, the deal could result in increasing the market power of the behemoth in various dealings with other market players. Still, Tabcorp and Tatts Group remain with their eyes on the deal, hoping to finally close the agreement until the end of 2017. According to the two companies, the deal would be quite helpful for them, as it would make them more competitive in comparison to international bookmakers. According to the two companies, merger deals were the only way for smaller market players to resist the constantly growing demand on the market.
The Australian Consumer and Competition Commission is still against the merger, saying that the negative impact that Tabcorp and Tatts Group deal would have on local competition exceeds the eventual benefits it would have for the public. Originally, the ACCC was expected to present a decision on May 4th. However, due to the fierce opposition of the Commission, Tabcorp made the decision to withdraw from the ACCC’s approval process back in March and took the matter directly to the Australian Competition Tribunal.
At that time, Tabcorp issued an official press release, revealing that the two companies would seek approval from other government and regulatory authorities required for the merger in order to be able to finalise the deal over the third quarter of 2017.
- Author
Olivia Cole
