The Australian Consumer Watchdog ACCC (Australian Competition and Consumer Commission) has expressed its concern over the proposed acquisition by DP World of the door-to-door logistics specialist Silk Logistics.
Silk operates 21 logistics centers and 25 storage sites in five Australian states. The company is expected to become part of DP World Australia, which operates four container terminals and three container parks in Brisbane, Sydney, Melbourne, and Fremantle, as well as internal distribution centers and warehouses.
DP World Australia, on average, handles approximately one third of the containers processed at the four ports.
The ACCC has outlined preliminary competition concerns, including that DP World’s ownership of a national container transport provider is likely to reduce competition and could lead to higher prices and reduced quality for Australian importers and exporters.
ACCC Commissioner, Philip Williams, said the regulator is also investigating the potential for DP World to gain access to commercially sensitive information about Silk’s rivals through the acquisition.
The Dubai-based ports and logistics giant reached an agreement to acquire Silk for approximately $174.5 million ($115.6 million) or $2.14 per share last November. The company’s board has unanimously recommended that its shareholders approve the acquisition.
The ACCC has invited interested parties to submit their views by March 27 and is likely to announce its findings in early June.
Adis is an experienced news reporter with expertise in finance, media, and education. He has written across the spectrum of the offshore energy and ocean industries for many years and is a member of the International Federation of Journalists. He had previously written for the media titles of the Navingo Group, including Offshore Energy, Subsea World News, and Marine Energy.
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