Suncorp blocked bank sale appeal warns on implications
Suncorp has warned in an appeal to the Australian Competition Tribunal over the blocked sale of its bank to ANZ that a proposed investment in a Queensland disaster recovery centre would not be possible to the same extent if the deal doesn’t proceed.
Both companies have separately applied for a review of the Australian Competition and Consumer Commission (ACCC) decision to deny authorisation for the proposed $4.9 billion sale of its bank.
In its application, Suncorp rejects competition issues raised by the ACCC, says “there’s no realistic commercial likelihood” an alternative acquisition by Bendigo and Adelaide Bank would lead to a better outcome and argues public benefits from a sale to ANZ would outweigh any detriments.
The application reiterates that selling the bank would allow the company to have a singular focus on its insurance business, while a Queensland jobs and investments package outlined as part of the deal would also be affected.
“The disaster recovery centre and employment commitments given by Suncorp Group were made possible only because of the size of the consideration to be paid by ANZ for Suncorp Bank,” the application says.
“Suncorp Group would not, and would not be able to, pursue these initiatives in the same way or to the same extent in the status quo counterfactual or the Bendigo/Suncorp Bank counterfactual.”
The company said on Friday that it maintains the view that the sale of its bank to ANZ is in the best interests of its customers, shareholders and employees and will deliver public benefits for Queensland and a net benefit to the Australian economy.
ANZ’s submission also says the tribunal should give weight to significant and merger specific benefits from a Suncorp monoline insurance focus.
“The evidence establishes that there are likely to be significant efficiencies from Suncorp Group simplifying its insurance business via the proposed acquisition and the commission wrongly concluded the public benefit would be small despite accepting the proposed acquisition would be likely to improve the overall performance of Suncorp Group's insurance business,” it says.
The Australian Competition Tribunal can vary or set aside an ACCC decision. The acquisition also remains subject to approval from the Federal Treasurer and Queensland legislative amendments.
Suncorp and ANZ say that should all approvals be received they expect completion of the deal by the middle of next calendar year.
The Australian Competition Tribunal will hold a directions hearing tomorrow afternoon, presided over by tribunal President Justice Michael O'Bryan.