Australia watchdog not happy with Tabcorp's $4.7 billion Tatts acquisition
The move is a potential setback for a deal which was cleared last month, more than a decade after the companies first proposed it. Shares of both companies retreated from sharp initial gains after the news.
Tabcorp and Tatts took the unusual step of applying to the court-run Australian Competition Tribunal (ACT) after the usual arbiter, the Australian Competition and Consumer Commission (ACCC), raised concerns about the deal.
On Monday, the ACCC said it has applied to the Federal Court asking it to review the ACT's decision to green-light the deal.
"We are seeking judicial review because we believe these legal principles are fundamental not only to the Tabcorp decision but to all future merger and nonmerger authorisation assessments," ACCC Chairman Rod Sims said in a statement.
The ACCC said it was seeking a review based on the grounds that the ACT misused certain tests which competition regulators use to determine if a deal will hurt competition, and gave inappropriate weightings to data about the effects of the takeover. ■