Challenger Life No.2 Limited - proposed acquisition of the existing annuity policy, personal superannuation and allocated pensions business of MetLife Insurance Limited

Summary

Challenger Life No.2 Limited proposes to acquire the existing annuity policies of MetLife Insurance Limited.

Market definition

This merger was assessed within the context of the national markets for the manufacture and supply of i) long-term annuities, and ii) short-term annuities.

Competition analysis

On 18 April 2007, the ACCC formed the view that the proposed acquisition was unlikely to result in a substantial lessening of competition in the relevant markets. Factors informing this conclusion included:

- There remain a number of sizeable competitors in the two markets, who are likely to act as a strong competitive constraint on the merged firm.

- Financial intermediaries exercise a significant degree of countervailing power, which is also likely to constrain the merged firm.

- Impending regulatory changes mean that annuity providers in the relevant markets will face competition from a wider range of products.