Competition watchdog greenlights Viva Energy's OTR buy-out

The news: The ACCC said it will not oppose Viva Energy’s proposed acquisition of OTR Group, after accepting a court-enforceable undertaking that commits Viva Energy to divest 25 Coles Express sites in South Australia.

The numbers: Viva Energy, which initially offered to divest 23 of its 32 Coles Express sites in Adelaide, increased the number to 25 (including one in Ceduna) in response to concerns raised by the ACCC. In exchange for the 25 divestiture sites, which will be purchased by Chevron at the approval of the competition regulator, Viva Energy will receive 13 Chevron sites located in Queensland, New South Wales and Western Australia.

The context: Viva Energy and its related companies operate a nationwide fuel supply chain, including Coles Express sites. After Viva Energy's proposed $1.15 billion acquisition of fuel and convenience retailer OTR Group, the ACCC undertook a consultation on the competition effects at both the retail and wholesale levels, concluding that the proposed acquisition will not result in a substantial lessening of competition.

What they said: ACCC Commissioner Stephen Ridgeway said: “Without the divestiture, the proposed acquisition would combine the largest retail fuel network in South Australia with Viva Energy’s retail network, providing Viva Energy with an extended network that is significantly larger than its next largest rival."