Competition and Consumer Commission will not oppose StarTrack acquisition

Australia Post has welcomed the public notification from the Australian Competition and Consumer Commission (ACCC) that it will not oppose Australia Post's plans to acquire Qantas' 50 per cent interest in StarTrack.

Commenting on last Friday’s announcement by the ACCC, Australia Post Managing Director and CEO Ahmed Fahour said: “The acquisition forms part of a $2 billion investment in Australia Post's national logistics and retail network and StarTrack is a key strategic investment, offering significant express freight capabilities that complements our international and domestic parcels business.

“Together, Australia Post and StarTrack will offer a broad range of products to consumers, small-and-medium enterprises and larger businesses.”

Australia Post already owns 50 per cent of StarTrack and has been involved in the joint venture with Qantas since 2003. This deal would make Australia Post the sole shareholder in the express freight and logistics provider.

As part of the transaction, Australia Post will divest its 50 per cent interest in Australian air Express to Qantas as this business is no longer considered a core investment for Australia Post.

The ACCC considered the effects of the proposed acquisition on the supply of express small package delivery services in Australia. While both Australia Post and StarTrack provide a range of services this was the only area where there was overlap between the parties.

The ACCC concluded that the proposed acquisition was unlikely to substantially lessen competition in the market for the supply of express small package (up to 32 kg) delivery services in Australia. It considered that the competitors to the merged entity would continue to provide a strong competitive constraint post-acquisition for the supply of express small package delivery services in Australia.

The ACCC also had regard to the existing level of strategic influence that Australia Post exerts on StarTrack by virtue of its 50 per cent shareholding. In this regard, the ACCC did not consider that the proposed acquisition was likely to result in a significant impact upon the existing structure in the relevant market.

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