The ACCC will not oppose Endeavour Group Limited’s proposed acquisition of the Rye Hotel on the Mornington Peninsula in Victoria.
The Rye Hotel includes a hotel, accommodation and an adjoining independent drive-through liquor store operating under the ‘Thirsty Camel’ brand. Endeavour operates BWS Rye, and several stores in the neighbouring towns of Rosebud and Sorrento.
“The ACCC did not have any concerns in relation to accommodation, gaming or meals, given the number of competitors in the area offering these services and Endeavour’s limited presence in these local markets,” ACCC Commissioner Stephen Ridgeway said.
“However, we did give close consideration to whether this proposed acquisition would lead to a substantial increase in local market concentration in liquor retailing.”
In a finely-balanced assessment, the ACCC found that unique circumstances meant that this transaction is not likely to substantially lessen competition in this market even though the proposed acquisition would combine the two largest liquor stores in the local area.
“The Rye Hotel drive through does not appear to strongly compete on price or range, and mostly attracts customers because of the convenience of its drive-through service,” Mr Ridgeway said.
The ACCC considered that consumers would continue to have access to different promotions, pricing, ranges and service offerings in the local area, including at two nearby Thirsty Camel branded stores, Peninsula Cellars and Tootgarook Fine Wine Cellars.
“The ACCC will continue to closely consider consolidation in local markets, particularly acquisitions that occur within a pattern of serial acquisitions,” Mr Ridgeway said.
The ACCC also concluded that the proposed acquisition is unlikely to materially reduce the competitiveness of other stores that operate under the Thirsty Camel brand or weaken the overall strength of independent wholesalers.
Note:
In considering the proposed acquisition, the ACCC applies the legal test set out in section 50 of the Competition and Consumer Act.
In general terms, section 50 prohibits acquisitions that would have the effect, or be likely to have the effect, of substantially lessening competition in any market.
Background
Endeavour 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 currently operates one BWS bottle shop in the local area, BWS Rye. BWS Rye is approximately 900 metres from the Rye Hotel by road and is located adjacent to Woolworths Rye.
The Rye Hotel is located in the town of Rye on the Mornington Peninsula in Victoria. The building houses:
- on-premises food and beverage areas, including function rooms, live entertainment, TAB and gaming facilities,
- an attached drive-through bottle shop which trades under the Thirsty Camel banner, and
- beachfront accommodation.
Peninsula Cellars, trading under the Thirsty Camel brand, is also owned by the vendor but it does not form part of the proposed acquisition.
