The ACCC will not oppose MYOB Invest Co Pty Ltd’s acquisition of GreatSoft Pty Ltd, finding the transaction is not likely to substantially lessen competition.
MYOB and GreatSoft both supply practice management software to medium-to-large accounting firms. MYOB offers desktop practice management software, and GreatSoft offers a cloud-based solution.
The ACCC’s investigation focused on GreatSoft’s potential to grow into a strong competitor, given that GreatSoft had succeeded in winning a number of medium-to-large customers, including MYOB customers, when it first launched its product in 2019.
However, the ACCC concluded that GreatSoft will likely face challenges expanding its small customer base in the short to medium term if the acquisition does not go ahead.
“GreatSoft’s growth has been limited since it entered the market and we saw little evidence that it would grow to be a significant force in the market in the short to medium term,” ACCC Commissioner Stephen Ridgeway said.
“GreatSoft would have to manage market uncertainty arising from this transaction, maintain integrations with third parties, some of whom are competitors, and its prospects did not look good given it has missed the prime selling window for accountants to switch on 1 July.”
The ACCC also determined that, following the proposed acquisition, MYOB and GreatSoft would continue to face significant competition from other desktop and cloud-based providers of practice management software, including Xero and Reckon.
“Although Xero Practice Manager has been designed for smaller firms, it continues to attract a number of medium-to-large firms to its cloud-based product and will impose a strong competitive constraint on a combined MYOB and GreatSoft,” Mr Ridgeway said.
Further information is available at: MYOB Invest Co Pty Ltd – GreatSoft Pty Ltd
MYOB is a privately held company that provides software solutions to businesses and accounting practices in Australia and New Zealand. For accountants, it supplies desktop-based products which are MYOB AccountantsOffice (AO) for small firms, and MYOB AE for medium-to-large firms. These products include a practice management module, in addition to document management, tax, accounting and compliance modules.
GreatSoft is owned by GreatSoft Proprietary Limited, a South African company. It was established in Australia in 2018, although it did not officially launch until September 2019. GreatSoft only supplies a cloud-based practice management module, and integrates with a range of third party software suppliers for other accounting modules, including Xero for Xero Tax.
Practice management software is considered to be the ‘backbone’ of the broad range of software modules used by accountants, and holds client details, and manages invoicing and workflow.
Medium-to-large firms refer to accounting firms with more than 26 employees but do not include the largest global and Australian firms who generally use enterprise resource planning products that require bespoke design and development.