SummaryBrambles Information Management Pty Ltd (Brambles) - proposed acquisition of Audsoc Holdings Pty Ltd (Ausdoc). Brambles, through its subsidiary Recall, operates Australia's largest records and document management business. Ausdoc is also a provider of document and records management services in Australia.
Market definitionThe ACCC identified three relevant markets:
a. the national market for the supply of digital document management services;
b. the regional market for the supply of physical document management services; and
c. the regional market for the supply of secure destruction services.
Competition analysisIn the national market for digital document management services, having regard to the level of market concentration post-acquisition and the fact that Brambles' presence will not increase post-acquisition, coupled with the availability of a number of alternative suppliers, the ACCC considered that the proposed acquisition would be unlikely to result in a substantial lessening of competition.
In the regional markets for the supply of physical document management services and secure destruction services, having regard to the merger factors, the ACCC considered that the proposed acquisition would be unlikely to result in a substantial lessening of competition in either of the markets primarily because:
- barriers to entry into these markets appear to be relatively low, having regard to low sunk costs and noting recent successful entry into the markets;
- the ability of larger customers to tender for records management contracts, together with evidence that a proportion of companies currently, or have in the past, managed records internally (captured in the unvended market) indicates that some degree of countervailing power resides with customers;
- post-acquisition, a number of alternative physical document management providers will remain, and internal records management and digital records management may be viable alternatives for the requirements of some customers; and
- market dynamics, particularly technological development in the electronic information management market, are likely to continue to provide an important competitive constraint and motivate Brambles to continue to undertake innovation post-acquisition.
Accordingly, the ACCC did not intervene in the proposed acquisition.