Tatts-Tabcorp merger put on hold

It looks as if the proposed A$11.3 billion merger of Australian gambling giants Tatts and Tabcorp has encountered a speed bump following a decision by three federal judges Wednesday to refer the proposal back to the Australian Competition Tribunal for further consideration.

The reasons for the referral were not explained.

The judges had previously considered appeals by the national ACCC anti-trust regulator and Crown Resorts Ltd’s CrownBet online unit, to set aside the tribunal’s decision in June this year to allow the merger to go ahead.

Initially signed in October last year, the two companies anticipated that the merger would be completed by mid-2017, but since then opposition to the deal has grown.

The Australian Competition and Consumer Commission welcomed the court decision to support its appeal, which was based on a view that a takeover would substantially lessen competition.

Chairman Rod Sims also argued that the Australian Competition Tribunal mistakenly failed to compare the likely future state of competition both with and without a merger.

Our readers may recall that Tabcorp approached the ACCC for approval of its planned offer in November 2016, but subsequently withdrew its application and instead referred the issue to the Australian Competition Tribunal after the ACCC released a statement containing concerns it had with the deal.

Shares in Tabcorp and Tatts were placed on trading halts ahead of the court decision.

Related and similar