The Australian Competition and Consumer Commission (ACCC) has issued its preliminary views, under a Statement of Issues (‘SOI’), with regard to the proposed combination of Tabcorp Holdings Limited (ASX: TAH) and Tatts Group Limited (ASX: TTS). The key issue highlighted by the ACCC relates to the electronic gaming machine monitoring services and repair and maintenance services in Queensland. The Commission that the transaction will substantially lessen the competition in supply of monitoring and other services to pokies venues in Queensland.
On the other hand, Tabcorp said that the group is well advanced in addressing the issues identified in the SOI. Further, the group has committed to divest its Odyssey Gaming Services business in order to address the above key issue highlighted by the ACCC. TAH is already at an advanced stage with regards to the sale process. This sale is subject to the receipt of approvals from ACCC and other necessary approvals along with completion of the transaction. TAH has also made detailed submissions to the ACCC which it believes addresses the remaining issues including the one that relates to the removal of potential supplier of totalisator pooling services. TAH aims to review the SOI in detail and assess the options to maximise the prospects of receiving a transaction approval.
The group believes that proposed merger is going to deliver value for shareholders of both the groups along with benefits to other stakeholders across Australia including the racing industry, venue partners, customers and Governments. Some key benefits include providing a national footprint with an enhanced operational platform; creating economic benefits by delivering additional funding to the racing industry and venue partners; and a pathway to national pooling for pari-mutuel wagering.
TAH stock surged about 2.7% on March 09, 2017.
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