BP boss vows to ‘escalate’ fight for Woolworths servos deal

BP Australia president Andy Holmes. Picture: David Geraghty

ELI GREENBLAT
December 14, 2017
The Australian

BP Australia president Andy Holmes has vowed to “escalate” the legal campaign to acquire Woolworths’ petrol stations after an informal merger proposal was opposed by the competition regulator yesterday.

Mr Holmes said he had “fundamental concerns’’ about the Australian Competition & Consumer Commission’s analysis that led it to its decision, and he would soon reveal his next step. That would likely see the matter taken to the Federal Court or the Australian Competition Tribunal.

He said Woolworths was fully supportive of his view that the ACCC’s rebuttal of the deal should be taken to a court or tribunal where a decision would be made on the evidence.

His resolute stand shows BP and Woolworths will not be walking away from their $1.8 billion deal, and the merger is set to drag on into its second year.

Woolworths announced last December it would sell 531 sites and 12 development sites to BP, but the deal has been delayed due to competition concerns.

Those concerns, which the parties tried to soften by agreeing to sell some sites, proved too much for ACCC chairman Rod Sims, who has now delivered his formal opposition to the proposal.

Mr Holmes told The Australian he was disappointed with the ACCC’s decision to oppose the informal merger proposal, but this was just the start of the battle.

“Yes, disappointed, but we are far from done on this,’’ he warned. “We are still highly committed to the transaction and I will be choosing an option to make sure we end up in a forum that will make the decision based on the evidence. We will escalate in some way.’’

It could mean BP and Woolworths execute the acquisition and then wait for the ACCC to launch its own action, ask for formal merger approval from the ACCC or fight its case in the Federal Court or Competition Tribunal.

“I haven’t decided exactly which route yet because there is more than one available, but we are going to follow up on this,’’ Mr Holmes said. “We remain strongly of the view the transaction won’t substantially lessen competition in any market and we have got some fundamental concerns with the ACCC’s analysis.’’

Mr Sims said consumers would pay more for petrol if the deal went ahead, and even a rise of 2c a litre due to the lessening of competition was a concern.