Australian gambling operator Tabcorp accused openly the Australian Competition and Consumer Commission (ACCC) of siding with opponents of its proposed A$11-billion merger with fellow gambling company Tatts Group.
Tabcorp representatives spoke before the Federal Court of Australia on Thursday as part of a directions hearing. The brief hearing took place ahead of a 14-day hearings period before the Australian Competition Tribunal (ACT). The hearings are slated to begin next week and to run through June 2. The ACT is expected to announce its final decision on the proposed merger between the major gambling operators on June 13.
Tabcorp had previously filed with the ACCC to review the deal and to make a competition judgment on the matter. In March, the operator announced that it would bypass the commission and would take its proposal to a higher authority, namely the ACT. Here it is important to note that the tribunal is presided by a Federal Court judge and it has been on a rare occasion that a merger deal has been brought up for consideration by the ACT.
Tabcorp will have to convince the tribunal that the A$11-billion deal would not have adverse effects on competition in Australia’s gambling space. Three main objectors have so far spoken strongly against the merger, with those being bookmaker CrownBet, mostly owned by local casino operator Crown Resorts, Racing Victoria, known to be the governing racing authority in the State of Victoria, and the Racing.com racing and gambling news outlet. According to the three parties, there will practically be no competition in the field, if the merger is given the nod by competition authorities.
Cameron Moore, Tabcorp’s senior counsel, stated before court that the above-mentioned three objectors were trying to protect their own interests rather than those of the whole gambling field and that their evidence should be neglected during the deal’s review.
Mr. Moore further noted that the ACCC had clearly sided with those opposing the transaction, his claim based on a report submitted by the commission in April. Under the merger proposal, the combined Tabcorp/Tatts entity would bring numerous public benefits and annual synergies of A$130 million. As per the ACCC’s report, the benefits were rather overstated and the combined business would eliminate gambling licenses and racing broadcast rights competition.
Despite Tabcorp’s objection, CrownBet, Racing Victoria, and Racing.com will be called as witnesses during the upcoming hearings. It also became known that they will be cross-examined by the tribunal for two-and-a-half days, unlike Tabcorp’s witnesses, who will undergo five-and-a-half-day cross-examination.
However, a recent broader information request, filed by the objecting parties, that would have allowed access to Tabcorp’s betting pool take-out rates and related information, was denied by the overseeing authorities.
