August 25, 2017
The Australian Competition and Consumer Commission has flagged initial concerns in relation to the proposed acquisition of OfficeMax Australia by Platinum Equity. Platinum Equity recently acquired the Australian and New Zealand businesses of Staples Inc.
The ACCC outlined its preliminary view that combining Staples and OfficeMax may substantially lessen competition in the supply of traditional office products such as stationery, notebooks, and copy paper to large commercial and government customers in Australia.
“The ACCC’s primary concern is that the loss of competition between Staples and OfficeMax could result in higher prices and lower levels of service,” ACCC Commissioner Roger Featherston said.
“We are considering the extent to which other competitors will have the ability to compete with a combined Staples/OfficeMax for large customers after the acquisition.”
The ACCC is also considering a competing bid by Complete Office Supplies to acquire OfficeMax.
In 2015, the ACCC considered a global merger between Staples Inc. and Office Depot, ultimately deciding not to oppose the acquisition in Australia. That transaction was not completed following court action taken by the US Federal Trade Commission.
“The ACCC considers each merger review on its merits and the facts presented during the review,” Mr Featherston said.
“In our 2015 review, very few concerns were expressed by market participants and the ACCC considered that Officeworks was likely to be a credible competitive threat in the future. The current ACCC review takes into account changes to the market and a higher level of concern from market participants. In addition, Officeworks does not appear to have expanded significantly into supplying large customers or to have any intention of doing so.”
The ACCC invites further submissions from interested parties in response to the Statement of Issues by 7 September 2017. The ACCC’s final decision is currently set to be announced on 16 November 2017.
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