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ACCC won’t oppose Platinum’s bid for OfficeMax

Thursday, 30 November 2017
By Print21

Corporate regulator the ACCC will not oppose the proposed acquisition of OfficeMax Australia by US equity giant Platinum Equity, which earlier this year bought Staples Australia – since rebranded as Winc.

The decision follows the commission’s similar decision earlier this month that it would not oppose a bid for OfficeMax by Complete Office Supplies (COS).

‘A finely balanced decision’: Rod Sims, ACCC.

“Any deal that sees the largest supplier acquiring the second largest in a market will require very close scrutiny,” said ACCC Chairman Rod Sims. “However, in a finely balanced decision, the ACCC found that a combined Winc-OfficeMax would continue to face competition from the remaining key suppliers, Complete Office Supplies and Lyreco.”

“Following extensive market inquiries and analysis of documents and data, the ACCC has decided not to oppose this transaction. The ACCC believes the transaction will lessen competition but doesn’t reach the threshold of causing a substantial lessening of competition.

“Many large commercial and government customers put their contracts out to tender, and both COS and Lyreco have recently been successful in winning customers from Winc and OfficeMax. As a result, the ACCC considers that COS and Lyreco, combined with the ability of large customers to switch suppliers and to purchase products off-contract, are likely to provide a sufficient competitive constraint on the combined Winc-OfficeMax.

“The ACCC would also expect that if prices and returns increased through an exercise of market power by a combined Winc-OfficeMax, it is likely that other existing suppliers of office products would seek to grow their market share.”

Winc and OfficeMax both supply office products to commercial and government customers in Australia.

The New Zealand Commerce Commission has applied to the NZ High Court to block the sale of OfficeMax’s New Zealand arm to Platinum, citing competition concerns.

Platinum Equity is a multi-billion-dollar global private equity firm specialising in mergers and acquisitions.

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