Aurizon has secured the nod of the Australian Competition and Consumer Commission (ACCC) for its proposed purchase of One Rail Australia, subject to the sale of the latter’s east coast business.
The regulator accepted a court-enforceable undertaking from Aurizon on the same.
This undertaking enables Aurizon to divest the business by a trade sale or demerging it as a new separate ASX-listed entity.
The east coast business comprises One Rail’s coal haulage operations in New South Wales (NSW) and Queensland.
Upon the completion of the deal, Aurizon will continue to hold One Rail’s bulk haulage operations as well as rail network assets in South Australia and the Northern Territory.
ACCC Chair Gina Cass-Gottlieb said: “Without the divestment of One Rail’s east coast business, the ACCC considered that the proposed acquisition would reduce the number of main competitors in the supply of coal haulage in New South Wales and Queensland from three to two, likely resulting in higher prices or decreased service levels.
“The divesture ensures that there will remain three main suppliers of coal haulage in New South Wales and Queensland.”
Last month, the ACCC expressed concerns over the deal on competition grounds.
In October last year, Aurizon agreed to acquire One Rail for A$2.35bn ($1.75bn).
Both Aurizon and One Rail are two of the three key providers of coal haulage services in NSW and Queensland.
Aurizon is said to be the largest supplier of coal haulage in Queensland, and the second largest in NSW.