ACCC Expresses Concerns about ANZ Terminals, GrainCorp Deal

The Australian Competition and Consumer Commission (ACCC) has raised “preliminary” concerns about ANZ Terminals’ proposed acquisition of GrainCorp’s Australian Bulk Liquid Terminals business. 

Unveiled in March this year, the transaction is worth around AUD 350 million (USD 244 million).

ANZ Terminals and GrainCorp both provide port-side bulk liquid storage services in New South Wales, Victoria and South Australia, where they compete to store liquids including edible oils, tallow, non-flammable industrial chemicals and base oils.

“Our preliminary view is that the acquisition will remove a significant competitor in what is an already concentrated industry in NSW, Victoria, and South Australia,” Rod Sims, ACCC Chair, said.

“We are also considering the impact on competition in the east coast states more broadly, including Queensland.”

“In some locations, the acquisition will lead to ANZ Terminals becoming the only storage provider for some liquid products. This loss of competition could result in higher prices for customers, or lower levels of service,” Sims added.

The ACCC considers that there is limited vacant land available for lease by new storage providers at the ports, creating a key barrier to entry for potential new competitors.

“Even where land may be available, it is highly uncertain that any new entrants would emerge in the bulk liquids sector to challenge ANZ Terminals,” according to Sims.

ANZ Terminals intends to divest the Osborne terminal in South Australia. The ACCC is still considering whether the undertaking will address the competition concerns in South Australia.

“The proposed undertaking does not address the preliminary concerns we have in New South Wales and Victoria.”