The Australian Competition and Consumer Commission will not oppose the proposed acquisition of the Aqua-Max water heater business from Sietel Ltd, by Rheem Australia Pty Ltd.
The ACCC has concluded that the proposed acquisition would be unlikely to substantially lessen competition in the relevant market for water heaters.
The ACCC's investigation included extensive market inquiries with the merger parties, customers, competitors, importers, representative industry bodies, State and Federal government departments and other relevant market participants.
The ACCC examined existing and proposed Federal Government and State Government regulation of the water heater industry and its potential impact on the current and future availability of particular types of water heaters to households Australia wide.
Information provided to the investigation indicated that Rheem, Dux and Aqua-Max are the three most significant national suppliers of electric and gas storage water heaters. They are each others' closest competitors for the supply of these products. Aqua-Max was identified as a vigorous and effective competitor in an industry where there are significant barriers to entry or expansion.
However, the ACCC concluded that the proposed acquisition would be unlikely to result in a substantial lessening of competition, mainly because significant numbers of households are switching from electric and gas storage water heaters to alternatives including instantaneous gas, solar and heat pump water heaters.
A Public Competition Assessment outlining the ACCC's reasons for its decision will be available on the ACCC's website in due course (refer to Public Competition Assessments).