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Tribunal’s authorisation of Tabcorp and Tatts merger

04 December 2017 | Australia
– By Grant Marjoribanks, Patrick Gay and Merryn Quayle

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CrownBet and the Australian Competition and Consumer Commission (ACCC) have confirmed that they will not be seeking judicial review of the Australian Competition Tribunal’s authorisation of Tabcorp Holdings Limited’s (Tabcorp’s) acquisition of Tatts Group Limited (Tatts), paving the way for the scheme to be approved before Christmas.

The merger authorisation

On 17 November 2017, the Australian Competition Tribunal granted authorisation to Tabcorp, represented by Herbert Smith Freehills, to acquire the shares in Tatts as part of the $11 billion merger of the two companies (see our original legal briefing here).

The Tribunal had originally authorised the merger in June, but following the decision of the Federal Court of Australia to set aside the authorisation, the matter was remitted to the Tribunal for reconsideration.

In determining whether the merger would be likely to result in such a benefit to the public that it should be permitted to occur, the Tribunal largely confirmed its original findings, concluding that the merger will likely enhance competition, result in “substantial” public benefits and would cause no material detriments capable of outweighing these benefits (see our summary of the determination here).

ACCC and CrownBet won’t seek review of Tribunal decision

Following the publication of the Tribunal’s reasons for the authorisation, both CrownBet and the ACCC indicated that they were reviewing the Tribunal’s determination and considering their options, signalling the possibility of another challenge in the Federal Court of Australia.

Yesterday CrownBet announced that it "no longer opposes the merger of Tabcorp and Tatts and will not interfere in any way with the implementation of the merger," after it reached an arrangement with Tabcorp and Sky in relation to the streaming of racing vision.

The ACCC announced today that it had decided it will not apply for judicial review. ACCC Chairman Rod Sims is quoted as saying that the ACCC “do not consider there is any error of law that needs to be corrected. For this reason the ACCC will not be seeking further review.”

Scheme approval

The meeting of Tatts’ shareholders, at which the scheme of arrangement will be voted on, is currently scheduled to be held at Tatts’ Brisbane office on 12 December 2017.

The second court hearing for approval of the scheme is set down for 13 December 2017 before Justice Sifris in the Supreme Court of Victoria.

Pending a positive outcome at both the shareholders’ meeting and the second hearing for approval of the scheme of arrangement, the merger is scheduled to be implemented on 22 December 2017.

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