The competition regulator says the deeper pockets of private equity group Next Capital which is now a major backer of campervan rentals group Jucy should help inject competition into the sector, as it gave the green light to a merger of the two largest rivals in Australia, Apollo and Tourism Holdings.
The Australian Competition and Consumer Commission forced the divestment of $39 million of assets to smaller competitor Jucy. It said on Thursday that was enough to clear the broader union between Apollo, which is listed on the ASX, and Tourism Holdings, which is listed on the New Zealand stock exchange. The proposed deal was first announced last December.
Tourism Holdings operates brands in Australia including Maui, Britz and Mighty Camper. Apollo operates rental brands including Star RV, Apollo, Cheapa Campa and Hippie Camper.
Apollo shares climbed 11 per cent in early trading on the ASX on Thursday to 72¢. The stock was at 38¢ on June 30.
The ACCC in April had serious issues with the combined market power of Apollo and Tourism Holdings, and so a lengthy process of carving off some assets to appease them began months ago.
ACCC deputy chairman Mick Keogh said on Thursday that the divestment to Jucy would enable it to build sufficient scale to ensure more competition in the industry.
“Tourism Holdings and Apollo are the two largest suppliers of rental RVs in Australia and are each other’s closest competitor in a market where smaller rivals and potential entrants appear to face challenges achieving comparable scale,” Mr Keogh said.
He also outlined that Jucy now had private equity group Next Capital as a major backer after a deal which had just been signed, and that should also ensure it had the financial firepower to make sure it is a strong competitor…see full article.
