A multibillion-dollar deal to break up Australian logistics giant Asciano Ltd between local and international suitors yesterday hit a hurdle after a key corporate regulator raised concerns about reduced competition at ports.
The A$9.05 billion (US$6.5 billion) takeover, announced in March, would see the rail, freight and ports operator’s assets split between a consortium led by Canada’s Brookfield Infrastructure Partners LP and one headed by Australia’s Qube Holdings Ltd that includes a Chinese sovereign wealth fund.
A key concern was that the vertical integration of container terminals and transport providers at ports could disadvantage other companies providing similar services, and “raise rivals’ costs,” regulator Australian Competition and Consumer Commission (ACCC) said.
“Qube and Brookfield will each own 50 percent of Patrick container terminals and may have parallel incentives to favor their landside logistics operations,” ACCC chairman Rod Sims said in a statement.
The ACCC said it was also considering fears raised by rival firms in stevedoring — the process of loading and unloading ships — that they could be muscled out of the market.
“In addition, the ACCC is considering whether stevedoring and empty container park services will be bundled together, in a way that forecloses rival stevedores,” the watchdog said.
The ACCC invited further submissions from the industry before it announces its decision on July 21.
The agreement involves numerous state investment funds, including from Qatar, China, Singapore and Canada.
The deal ended a bidding war between the two consortiums over Asciano, which handles nearly half of all container traffic entering or leaving Australia.
There was a flurry of acquisitions in Australia’s transport sector — including Japan Post Holdings Inc’s purchase of Toll Holdings Ltd — last year, when Brookfield first made a bid for Asciano, amid a weakening local currency and the government’s push for increased infrastructure spending.
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