Acquirer: Group 4 Falck; Target: Wackenhut Corrections Corporation Australia Pty Ltd

Acquirer(s)

  • Group 4 Falck

Target(s)

  • Wackenhut Corrections Corporation Australia Pty Ltd

Summary

Group 4 Falck proposes to acquire a 57% interest in Wackenhut Corrections Corporation.

Market definition

The market is the national market for custodial services.

Competition analysis

The Panel considered that the proposed acquisition would not lead to a substantial lessening of competition in the national market for supply of custodial services for the following reasons:

- there appear to be at least two substantial companies which will compete against the post-acquisition entity;

- barriers to entry do not appear to be high;

- the threat of vertical integration is real;

- the countervailing power of customers, state and federal governments, is high; and

- the parties also claim that their respective Australian operations will be bound by the terms of the proposed acquisition agreement which state that they must remain in competition in Australia.

Merger type

Horizontal

Guidelines thresholds

Crossed

Imports above 10%

No

Initiation

Parties

ANZSIC code

9632