The Commerce Commission granted the clearance following assessment
Evergreen NZ Holdings has received a clearance from the Commerce Commission in acquiring all of the shares of ACM New Zealand Limited from ACM Holdings (NZ) Limited.
The Commission’s decision involved the consideration of how the acquisition could affect the competition in the national markets when it comes to services involving the supply of wholesale cash-in-transit, retail cash-in-transit, ATM maintenance, and precious cargo.
The assessment focused on the supply of cash-in-transit services, with the Commission being satisfied with the unlikelihood of the acquisition lessening competition in any of the markets in New Zealand, according to the Commission’s chairman Dr. John Small.
The Commission’s decision involved its assessment of competition in the markets of wholesale and retail cash-in-transit services should the acquisition not take place and the competition that would be gone should the acquisition occur. It took into consideration the information that was provided by Evergreen when it applied its proposal for the acquisition, which showed that the two companies were likely to cease operations in the near future, leading to a single national provider of the services, regardless of the acquisition being fully realized.
“As noted in Evergreen’s application, the relevant businesses of both Evergreen and ACM have suffered significant cash losses. An ongoing decline in the use of cash and reduced demand for cash-in-transit services – accelerated during the COVID-19 pandemic, and the rationalisation of bank branches – coupled with inflationary increases in costs makes it difficult for two national wholesale cash-in-transit providers to be financially viable,” said Small.
“Without the proposed acquisition, we consider that it is unlikely that both Evergreen and ACM would continue to provide cash-in-transit services in New Zealand,” he added.
Small further pointed out that ACM was projected to continue seeing losses and that it would eventually leave the markets, which led to the Commission’s conclusion that the proposed acquisition would not lead to a substantial loss of competition when it comes to the price as well as the quality of cash-in-transit services.
He added that the Commission also took into account the possible benefits to the public like the ongoing stable supply of cash-in-transit services to the market as well as the smooth transition from two cash-in-transit providers into one, which will not occur if the acquisition did not push forward.
