ANZ wins green light for $4.9b Suncorp bank takeover on appeal

The Australian Competition Tribunal has authorised ANZ’s $4.9 billion acquisition of Suncorp’s banking arm, overturning the competition watchdog’s rejection of the deal last year in a significant win for the country’s fourth-largest bank.

On Tuesday, Justice Allaster Halley ruled against the decision of the Australian Competition and Consumer Commission (ACCC) to reject the takeover, saying the merger was unlikely to substantially lessen competition.

ANZ chief executive officer Shayne Elliott said the tribunal’s decision was a significant milestone for the planned deal.

“The tribunal has concluded that the small increase in the market share of ANZ, if the proposed acquisition proceeds, would not have a meaningful impact on the degree or likelihood of the major banks engaging in successful coordination,” he said.

ANZ first made a bid for Suncorp’s bank in July 2022 as part of a plan to expand in retail banking. But its bid was rejected by the ACCC, which said there would be an increased likelihood of coordination between the four major banks in the supply of home loans if Suncorp became part of ANZ.

There were two key tests, of which the tribunal said at least one needed to be satisfied in order for the proposed acquisition to proceed and for the ACCC’s decision to be overturned. The first was that the deal would not be likely to substantially lessen competition, and the second was that the public benefits of the deal would outweigh its public detriment.

Halley said the tribunal was satisfied Suncorp was not a particularly strong competitor in the home loans markets and that the ANZ-Suncorp merger was not likely to substantially lessen competition in the home loan market or in Queensland’s agribusiness market.

He also said the tribunal was satisfied that the predicted integration and production efficiencies from the proposed acquisitions would provide public benefits that outweighed any reduction in competition.

Halley said the likelihood of an alternative scenario – a merger between Bendigo and Adelaide Bank and Suncorp was “far from certain” and would face significant execution challenges.

ANZ chief executive officer Shayne Elliott said the tribunal’s decision was a significant milestone and important step in the takeover process, but that the bank had further conditions to meet.

“We remain committed to completing the acquisition as soon as possible once all sale conditions are met,” he said in a statement on Tuesday.

Completion of the deal remains subject to legislative amendments by the Queensland parliament. It also needs approval by the federal treasurer.

In a media release following the tribunal’s decision, Treasurer Jim Chalmers said he would “carefully and methodically” consider whether the proposed acquisition was in the national interest under the Financial Sector (Shareholdings) Act upon receiving an application from ANZ and receiving Treasury advice, and that he would announce a decision in due course.

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