s. 50. Prohibition of acquisitions that would result in a substantial lessening of competition
On 13 March 2006 AGL announced an offer to merge with Alinta Ltd. Following the merger AGL intends to proceed with a demerger of the combined AGL/Alinta energy and infrastructure businesses. On 16 June 2006 the ACCC announced that it had decided not to oppose the proposed transaction after accepting court enforceable undertakings from AGL. The transaction is the first of three proposed Alinta AGL merger structures the ACCC is considering.
The undertakings commit AGL to a demerger that separates the key gas transmission assets and infrastructure management assets where the ACCC found competition concerns. If for any reason the demerger cannot occur AGL has committed to divesting its interests in the Australian Pipeline Trust and associated management contracts, which similarly addresses the competition concerns.
The undertakings ensure that the interest in the Eastern Gas Pipeline and the Moomba to Sydney Gas Pipeline will be held separately, including the management contracts in relation to those pipelines. The undertakings also ensure that in Western Australia, the Parmelia pipeline and Goldfields Gas Pipeline will be held separately from the key Dampier to Bunbury Pipeline. Furthermore, AGL's undertaking separates out many pipeline management contracts so that concerns in relation to aggregation of pipeline management assets are minimised.
