The Australian Competition and Consumer Commission will not oppose the proposed acquisition of Primac Holdings Limited by IAMA Ltd, ACCC Acting Chairman, Mr Allan Asher, announced today.
IAMA Ltd announced its intention to make a scrip takeover offer for all the ordinary shares in the capital of Primac Holdings Limited under Part 6 of the Corporations Law on 13 September 1996. One of the conditions of the takeover offer is that no action is to be taken, or threatened to be taken, by the ACCC under the Trade Practices Act 1974 which could prohibit IAMA acquiring all or any of the shares of Primac or which might lead to the takeover being challenged later.
"The ACCC conducted market inquiries and found that the relevant market is the retail market for rural merchandise products in Queensland and north coast New South Wales. The relevant market also includes a small amount of wholesale supply," Mr Asher said. "The main product groups are fertilisers, agricultural chemicals and animal health products.
"The rural merchandise market in the relevant region appears to be competitive at the moment, with a significant independent retail sector operating in the Queensland and north coast New South Wales area. Many independent rural merchandise retailers are members of buying groups which seem to give the independents the buying power necessary to remain competitive with the large chains.
"The ACCC has expeditiously conducted market inquiries, in accordance with the offer timetable," Mr Asher said. "After careful consideration, the ACCC considered that the proposed acquisition will be unlikely to substantially lessen competition in the market."
Mr Asher said the ACCC will closely monitor any further moves to increase concentration in rural merchandise retailing, with particular regard to the areas of agricultural chemicals and animal health products.
IAMA Ltd announced its intention to make a scrip takeover offer for all the ordinary shares in the capital of Primac Holdings Limited under Part 6 of the Corporations Law on 13 September 1996. One of the conditions of the takeover offer is that no action is to be taken, or threatened to be taken, by the ACCC under the Trade Practices Act 1974 which could prohibit IAMA acquiring all or any of the shares of Primac or which might lead to the takeover being challenged later.
"The ACCC conducted market inquiries and found that the relevant market is the retail market for rural merchandise products in Queensland and north coast New South Wales. The relevant market also includes a small amount of wholesale supply," Mr Asher said. "The main product groups are fertilisers, agricultural chemicals and animal health products.
"The rural merchandise market in the relevant region appears to be competitive at the moment, with a significant independent retail sector operating in the Queensland and north coast New South Wales area. Many independent rural merchandise retailers are members of buying groups which seem to give the independents the buying power necessary to remain competitive with the large chains.
"The ACCC has expeditiously conducted market inquiries, in accordance with the offer timetable," Mr Asher said. "After careful consideration, the ACCC considered that the proposed acquisition will be unlikely to substantially lessen competition in the market."
Mr Asher said the ACCC will closely monitor any further moves to increase concentration in rural merchandise retailing, with particular regard to the areas of agricultural chemicals and animal health products.