The Australian Competition and Consumer Commission will not intervene in the recent and proposed acquisitions by S8 Limited in the travel industry, ACCC Chairman, Mr Graeme Samuel, said today.
S8 acquired Harvey World Travel in late 2005 and recently acquired, or proposes to acquire, Transonic Travel Limited, Travelscene Limited and Gullivers Travel Group Limited. All the target firms are involved in the provision of travel retail and wholesale services in Australia.
"The ACCC considers that the recent and proposed acquisitions are unlikely to substantially lessen competition in markets for the provision of travel retail services, travel wholesale services, for example tour packages, and ticket consolidation services in Australia".
"The ACCC conducted a comprehensive investigation, including extensive discussions with many industry participants", Mr Samuel said. "In relation to the market for travel retail services, the ACCC formed the view that the market is not heavily concentrated, barriers to entry are not high, and there is evidence of new entrants. In addition, customers have strong countervailing power, and online retailers compete vigorously with shop front travel retailers. As a result, consumers are unlikely to face higher prices.
"The markets for travel wholesale and ticket consolidation services are more heavily concentrated. However, market inquiries indicated that there will still be a number of alternative suppliers. Also, barriers to entry are generally not high, and customers (such as travel agents) generally have strong countervailing power".
Based on these factors, the ACCC is of the view that the recent and proposed acquisitions are unlikely to substantially lessen competition in provision of travel retail, travel wholesale and ticket consolidation services in Australia.