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Australia's competition watchdog to review Accor's planned buyout of Mantra
October 18, 2017 / 6:47 AM / a month ago

Australia's competition watchdog to review Accor's planned buyout of Mantra

SYDNEY (Reuters) - Australia’s competition regulator said on Wednesday it will review French hotelier Accor SA’s (ACCP.PA) planned $920 million buyout of Australian hotel operator Mantra Group Ltd (MTR.AX).

A sign bearing the logo of the Mantra Group Ltd is displayed on the wall of a hotel in central Sydney, Australia, October 9, 2017. REUTERS/David Gray

The Australian Competition and Consumer Commission (ACCC) said it is monitoring the transaction and a “public review will be commenced in due course once certain information is provided by Accor and Mantra”.

The deal, a takeover of Australia’s second-largest hotelier by its bigger rival, would create the biggest hotel group in the country, with about 50,000 rooms and roughly 11 percent of the market, according to IBISWorld statistics.

The buyout requires the approval of the ACCC, as well as approval from Australia’s Foreign Investment Review Board.

Analysts expect a green light as the market is quite fragmented and particularly if regulators regard newer rivals such as Airbnb as competitors in the sector.

But some doubt is priced in to the market and there are concerns that divestments could be required in towns where the two hoteliers are the only players..

The ACCC announcement was made after market hours on Wednesday. Mantra shares had closed flat at A$3.89 below the offer price of A$3.96 per share.

The broader S&P/ASX 200 index was also flat, while Accor shares were flat in early trade in Paris.

($1 = 1.2749 Australian dollars)

Reporting by Tom Westbrook; Editing by Edwina Gibbs

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