Australia: Red light given to the $2.7 billion Recall takeover

Iron Mountain could be forced to sell off some of Recall Holdings’ Australian assets to save its $2.7 billion takeover bid, after the competition watchdog placed a massive hurdle before the deal.

But Recall was adamant the deal would proceed, saying Iron Mountain was legally obliged to “do whatever is required” to gain regulatory approval.

If it fails to satisfy the Australian Competition and Consumer Commission (ACCC), the United States document storage company must pay a $76.5 million break fee.

ACCC chairman Rod Sims said he was concerned the acquisition would “remove close competition” in Australia’s document storage market, which Iron Mountain and Recall already dominate.

In some cases the combined market share of Iron Mountain and Recall would be as high as 71 per cent, according to the ACCC.

“From our terminology the statement of issues is a red light not an amber light,” Mr Sims said. “We’re saying we do have competition concerns, rather than saying there may be competition issues, so it’s a stronger than usual statement.”

Full content: Reuters

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