Aurizon (ASX:AZJ) profits from failed ACCC appeal

• Rail freight operator Aurizon (AZJ) can progress with the sale of its Acacia Ridge Terminal in Queensland after the ACCC failed to win its High court appeal
• Aurizon is in the middle of a $205 million sale to fellow Australian operator Pacific National for the rail freight terminal
• The Federal Court held that the acquisition was not likely to substantially lessen competition and did not therefore breach section 50 of the Competition and Consumer Act 2010
• The ACCC’s application – that sought leave to appeal the decision over concerns it would defer new entrants to the market – has been rejected
• The sale is now subject to final approval by the Foreign Investment Review Board
• Shares in Aurizon last traded 0.94 per cent lower at $4.23 each

Rail freight operator Aurizon (AZJ) can progress with the sale of its Acacia Ridge Terminal after the ACCC failed to win its High Court appeal.

The ACCC’s rejected application sought leave to appeal the decision over concerns it would deter a new entrant from providing interstate linehaul services in competition with Pacific National.

Aurizon can now proceed with the $205 million sale of the Queensland rail freight terminal to fellow Australian operator, Pacific National.

The Federal Court held that the acquisition was not likely to substantially lessen competition and did not therefore breach section 50 of the Competition and Consumer Act 2010 in May 2019.

Section 50 of the Competition and Consumer Act 2010 prohibits acquisitions that would results in a substantial lessening of competition.

Aurizon has already received a non-refundable payment of $35 million as part of the $205 million sale. A further $170 million is payable to Aurizon on transaction completion which is expected in 2021.

The ACCC commenced proceedings alleging the sale breached section 50 back in 2018.

The sale is now subject to final approval by the Foreign Investment Review Board.

Shares in Aurizon last traded 0.94 per cent lower at $4.23 each.