The Australian Competition and Consumer Commission has announced that it will not oppose Dometic Group AB’s (Dometic) acquisition of Atwood Investment Holdings LLC (Atwood) (and consequently Aircommand Australia Pty Ltd (Aircommand)).
Dometic and Aircommand overlap in the distribution of heating, ventilation and air conditioning (HVAC) systems for caravans and other recreational vehicles (RVs).
“The ACCC took into account concerns expressed by some market participants about the loss of competition between these companies,” ACCC Commissioner Dr Jill Walker said.
“The ACCC determined that, following the acquisition, Dometic and Aircommand would face competition from existing competitors, Coleman, Denso and Gree, which are expanding their product offering, as well as potential new entrants.”
In 2014, Aircommand and Dometic were the largest and second largest suppliers of caravan HVACs, with a combined market share of over 75 per cent. Their products, like most of their competitors’ products, are imported into Australia. However, Dometic’s market share has declined in recent years.
“The ACCC also found that some customers would have the ability to bypass Dometic if it seeks to increase prices or lower service after the merger,” Dr Walker said.
The largest caravan manufacturer in Australia, Jayco, has a strong market position. Jayco’s purchasing decisions can influence competition in upstream markets, such as the market for the distribution of HVAC systems for RVs, where it is acquiring significant volumes of HVAC systems from competitors to Dometic.
The ACCC also determined that the proposed acquisition was unlikely to raise competition concerns in any other markets in which Dometic or Aircommand are active, including the sale of hot water systems for RVs, given the constraint from other competitors.
Further information is available at Dometic Group AB - acquisition of Atwood Investment Holdings LLC