Decision on merger drags out

Tourism Holdings Ltd (THL) and RV supplier Apollo Tourism & Leisure (ATL) have offered to divest certain assets as they seek to get regulators in New Zealand and Australia to approve their merger.

THL says in a note to the NZX on July 1 that it had entered into exclusive talks with Next Capital to sell proposed assets in New Zealand and Australia to Jucy Rentals.

Australian private equity firm Next Capital recently entered an agreement to acquire a controlling interest in Jucy, which is owned by Polar Capital. The sale of those assets is subject to regulatory approval.

THL says it is continuing to work with the Commerce Commission and the Australian Consumer and Competition Commission (ACCC) to address issues identified over the planned merger, although it continues to “strongly believe the proposed merger will not substantially lessen competition”.

It has now started discussions with the Commerce Commission and ACCC seeking clearance on the basis the merged entity divests certain assets in each country.

The Commerce Commission says it is seeking submissions from THL, Apollo and other interested parties on whether the proposed divestment would mean the proposed merger was unlikely to substantially lessen competition.

Submissions are due to close on July 15. The regulator is scheduled to make a decision on the merger application by August 2, although the date could be extended.

In late April, the commission said it was “not currently satisfied”  that THL’s proposed merger would not have, or would not be likely to have, the effect of substantially lessening competition in a New Zealand market.