Watchdog set to rule on CBA takeover bid

by Adam Smith14 Nov 2011

The ACCC is set to rule this week on a proposed merger that would see CBA acquire a large stake in Mortgage Choice.

The Australian Financial Review has reported that the competition watchdog will dedide within days whether to allow CBA's takeover of Count Financial. Count currently holds a 17% stake in Mortgage Choice.

The ACCC reportedly delayed its decision on the deal in order to seek a submission from Mortgage Choice. The company's chief executive, Michael Russell, has previously told Australian BrokerNews he expects CBA to offload its stake in the broker if the merger goes ahead. Russell said Mortgage Choice franchisees would be wary of any deal which saw CBA take a larger stake in the company.

"CBA is not only a valued lender partner to Mortgage Choice, but a staunch supporter of our industry and the consumer proposition mortgage brokers provide. Mortgage Choice franchisees are acutely aware of this support; however, it's pretty obvious that should CBA decide to hold a position on our register this would be met with a degree of trepidation. Why? Because, quite simply, our franchisees are happy with the status quo of our relationship, and secondly they would not want to lose the key selling point of being independently owned and operated, which is a contributor to our on-boarding of customers," he said.

According to the AFR, Mortgage Choice's ACCC submission has asked that CBA commit to offloading the stake if its Count takeover proceeds.

Related stories:

CBA acquisition not influenced by Mortgage Choice stake

CBA may offload Mortgage Choice

CBA launches Count takeover