The ACCC won’t oppose the proposed acquisition of the remaining 50 per cent interest in Liberty Oil Holdings’ wholesale business by Viva Energy Australia.
Viva and Liberty are both wholesalers and retailers of fuel products. The proposed acquisition involves Liberty’s wholesale business only.
Viva’s interest in Liberty’s retail business, says the ACCC, will remain at 50 per cent.
‘Unlikely’ to lessen wholesale competition
The ACCC found that the proposed acquisition is “unlikely” to substantially lessen competition in the wholesale supply of fuel products.
“Retailers told us that there are alternative wholesale suppliers and alternative brands they could switch to,” ACCC Commissioner Stephen Ridgeway said.
“We consider that, post-acquisition, the threat of fuel retailers switching to an alternative supplier is likely to constrain Viva’s wholesale prices and supply terms.”
Impact on retail supply competition ‘unlikely’
The ACCC says it also considered the effect of the proposed acquisition on competition in the retail supply of fuel products in metropolitan Adelaide and Melbourne and in local areas across the country.
“In metropolitan Adelaide, most Liberty branded sites are dealer sites, where Liberty does not set the price,” Mr Ridgeway said.
“The share of Liberty branded sites is relatively low and there are other retailers in Adelaide that are likely to constrain city-wide prices, such as United and X Convenience. Therefore, price increases from this proposed acquisition are unlikely.
“In metropolitan Melbourne, another city where Liberty branded sites operate, Liberty has a very small share of retail sites. The proposed acquisition is therefore unlikely to have a significant impact.”
In local areas where Liberty retail sites overlap with Viva retail sites, including Coles Express sites, the ACCC concluded that in most of these areas sufficient competition would remain after the acquisition.
“We identified potential competition concerns regarding some local areas. The merger parties provided further information or implemented changes which addressed our concerns,” Mr Ridgeway said.