ACCC To Not Oppose Archer Daniels Midland Co's Acquisition Of GrainCorp Ltd

Wednesday, 26 Jun 2013 07:34pm EDT 

The Australian Competition and Consumer Commission announced that it does not propose to oppose Archer Daniels Midland Co's (ADM) proposed acquisition of GrainCorp Ltd. The ACCC concluded that the proposed acquisition would be unlikely to substantially lessen competition as the merged entity would continue to face competition from a number of sources. In forming its view, the ACCC conducted an extensive public review process which involved consultation with grain growers, industry bodies and competitors about the likely effect of the proposed transaction on competition. The ACCC’s review looked at two key issues. First, the ACCC examined whether the proposed transaction would substantially lessen competition in any market by removing the existing competition between ADM and GrainCorp. Second, the ACCC examined whether ADM would have different incentives to GrainCorp such that it would be likely to foreclose third party access to the storage and transport supply chain following the merger, which may in turn reduce competition between traders to acquire grain. In forming its view, the ACCC noted the importance of ensuring access to bottleneck infrastructure where necessary. In this context, the ACCC currently administers access undertakings for access to bulk wheat port terminal services. 

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