Australia: regulator throws Brookfield’s $6.5 billion buyout into doubt

An Australian regulator raised antitrust concerns over a planned $6.5 billion takeover by Canada’s Brookfield Asset Management of freight firm Asciano, potentially jeopardizing the country’s biggest inbound deal in four years.

The proposed deal, which would be the largest-ever purchase of an Australian firm by a Canadian company, would give Brookfield Asciano’s rail network and train operations in two of the country’s eight states, the Australian Competition and Consumer Commission said in a statement on Thursday.

“The ACCC is concerned that the vertical integration will lead to a substantial lessening of competition in related markets for the supply of above rail haulage services in (Western Australia) and Queensland,” the commission’s chairman Rod Sims said.

While the ACCC made no mention of blocking the deal in its entirety, the statement raised uncertainty about whether Brookfield can overcome the regulator’s concerns without carving out large parts of the target company’s business – a move which would make it less appealing to buy.

Full content: Bloomberg

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