AUSTRALIA | The ACCC will not oppose Aurizon’s proposed acquisition of Flinders Logistics Pty Ltd. following a restructure of the transaction to address the ACCC’s preliminary competition concerns.
Flinders Logistics operates a stevedoring and logistics business for bulk and limited break-bulk cargo at Berths 18-20 and 29 in Port Adelaide and Port Pirie, South Australia. Berth 29 is considered critical for importing and exporting certain mining products and mineral sands.
Aurizon is a national freight company that provides rail haulage to and from Port Adelaide.
On the 11th of July 2024, the ACCC released a statement of issues outlining its preliminary competition concerns with the proposed acquisition.
“We were concerned that after the acquisition, Aurizon would have the exclusive right to load and unload all trains at Berth 29, Port Adelaide. Having this exclusive right was concerning to us because it may have provided Aurizon with the ability and incentive to limit the access of competing rail haulage providers,” said ACCC Commissioner Dr Philip Williams.
“This could have resulted in a substantial lessening of competition in the supply of rail haulage services for the import or export of containerised bulk minerals on behalf of customers in South Australia and western New South Wales and Victoria.”
Following the ACCC outlining its preliminary concerns, the merger parties restructured the transaction to exclude the underlease for the Berth 29 rail pad from the proposed acquisition, allowing third parties to load and unload trains themselves.
Dr Williams mentioned that under the new transaction structure, rival rail haulage providers will no longer be required to rely on Aurizon to load and unload their trains, which means other logistics companies can compete to supply mining customers.
“The ACCC carefully examined and consulted on the changes and has concluded that the acquisition is now unlikely to result in a substantial lessening of competition.”
Flinders Port Holdings Pty Ltd, the parent company of Flinders Logistics, will retain control of the rail pad and operate it as a standard user asset, using an access policy to be published on Flinders Ports’ website.
Third parties will be able to apply for a non-exclusive licence to use the rail pad to service trains during specified windows and for short-term container storage. Without the restructure, Aurizon would have retained an exclusive lease of that area.
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