Glencore gets unconditional ACCC approval for Viterra

The Australian Competition and Consumer Commission has announced that it will not stand in the way of Glencore’s proposed acquisition of Viterra. Switzerland-based Glencore is the world’s largest commodities trading company. Viterra is active in grain handling and marketing. The ACCC found that the deal would not substantially diminish competition because of the continued post-merger existence of significant competitors in the grain trading market.

The ACCC had come to its conclusion after a period of public comment and consultation. Despite Viterra’s current monopoly on bulk grain port terminal services, as well as its position in up-country grain storage and handling, “the proposed acquisition would be unlikely to enable Glencore post acquisition to depress prices paid to growers for grain or raise prices of grain to domestic customers.” Moreover, incentives or abilities to foreclose would not be materially affected after the deal because Viterra is already in a strong position.

Full content: ACCC Press Release

Related content: Behavioral Economics and Merger Analysis (Alison Oldale, Cleary Gottlieb)

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