The ACCC will not oppose Endeavour Group Limited's proposed acquisition of the Beachfront Hotel in Rapid Creek, just north of Darwin.
The Beachfront Hotel includes a hotel and an independent liquor store trading under the 'Cellarbrations' brand. Endeavour already operates a number of hotels and BWS stores in the local area.
"The ACCC looks closely at acquisitions that result in consolidation in local markets and initially identified concerns with this proposed acquisition," ACCC Acting Chair Mick Keogh said.
"However, after taking into account further information from the community and the parties, we were satisfied that the deal would not likely substantially lessen competition for the purchase of take-away alcohol because of the variety of alternatives in the local area."
In relation to the supply of takeaway liquor in the local area around the Beachfront, the ACCC ultimately concluded that a sufficient variety of liquor stores would remain in the area post-acquisition.
"Consumers in the local area would continue to have access to two Coles' Liquorlands and a variety of other liquor stores, operating under a range of banners including Cellarbrations, Thirsty Camel and Bottlemart," Mr Keogh said.
Overall, three owners of large liquor stores and 11 independently owned small liquor stores would remain in the 5km area of the Beachfront hotel.
"The ACCC will continue to look closely at consolidation in local markets. It is important that local consumers benefit from competition between different stores with different promotions, pricing, ranges and service offerings," Mr Keogh said.
The ACCC also considered the supply of on-premises services at the Beachfront Hotel but came to the view that Endeavour would continue to face competition from a number of alternative liquor, food and gaming providers after the acquisition.
The ACCC also concluded that the proposed acquisition is unlikely to materially affect the competitiveness of other independent liquor stores in Darwin.
In particular, the ACCC considers that removing the Beachfront Hotel liquor store from the Cellarbrations banner network, and removing it as a wholesale customer of Metcash-owned Australian Liquor Marketers (ALM), would not significantly impact the efficiency and competitiveness of other stores under the Cellarbrations banner, or those who are wholesale customers of ALM.
Background
Endeavour (ASX:EDV) is a major Australian alcoholic drinks retailer and hotel operator that operates a portfolio of brands including BWS, Dan Murphy's, Jimmy Brings, Shorty's Liquor and Langton's.
Endeavour also manages over 330 licensed hotels across Australia, through its subsidiary, ALH Hotels. Endeavour operates several liquor stores (including BWS Nightcliff and BWS Casuarina) and hotels (including Airport Tavern) near Beachfront Hotel.
The Beachfront Hotel is located in Rapid Creek, NT. It is currently owned by companies ultimately controlled by local businessperson Doug Sallis. It sits on a block of 7,500 sqm and includes a bistro offering on-site food and beverage, a public sports bar (with TAB), 20 gaming machines, and a drive-through liquor store. The liquor store has a trading area of approximately 270 sqm and currently operates under the Cellarbrations brand.
