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The National Australia Bank’s (NAB) sale of MLC Wealth Management to The Independent Order of Odd Fellows (IOOF) in September 2020 has progressed further after the Australian Competition and Consumer Commission (ACCC) announced that it would not oppose the merger.
IOOF and MLC Wealth Management both supply (through licensed financial advisers, corporate/employer sponsors and directly) superannuation and non-superannuation investment products and financial advice to consumers in Australia.
ACCC commissioner Stephen Ridgeway commented: “Transactions that combine two major firms in a sector will attract close scrutiny from the ACCC.
“However, feedback from customers, financial advisers and other industry participants suggested that this deal would not be likely to substantially lessen competition.”
The ACCC’s review indicated that IOOF would still be competing with, and constrained by, several other large firms along with a number of small firms.
It suggested that the IOOF’s market share would still be around 10 per cent after the acquisition.
The ACCC therefore concluded that the proposed acquisition was unlikely to substantially lessen competition in any relevant market.
“Despite the profile and size of this transaction, it does not raise concerns under section 50 of the Competition and Consumer Act largely due to the fragmented nature of most of the relevant markets and strong constraints from remaining competitors,” added Mr Ridgeway.
The $1.44 billion deal is expected to be complete “before the middle of calendar year 2021” should all regulatory approvals and transaction conditions be met.
[Related: NAB to sell MLC for $1.5bn]