Non-major to acquire ANZ lending business

by Julia Corderoy18 Sep 2015
Competition regulator the Australian Competition and Consumer Commission (ACCC) has approved Macquarie’s proposed acquisition of ANZ’s motor vehicle finance provider, Esanda Dealer Finance.

In a statement released yesterday, the ACCC said it would not oppose the bid as it was “not likely to substantially lessen competition” in the market for the supply of bailment finance and point-of-sale (POS) finance facilities to motor vehicle dealerships.

“The ACCC had some concerns that the proposed acquisition may lead to increased bailment interest rates (or lower commissions to dealers on POS finance), particularly for dealerships that do not have access to an aligned or in-house finance provider,” ACCC Chairman Rod Sims said.

“However, the ACCC concluded that on balance the combination of existing and potential competitive constraints would be sufficient to prevent a substantial lessening of competition as a result of the possible acquisition.”

Bailment finance is acquired by dealerships to finance the vehicles held in their showrooms before they are sold to customers. Dealerships also acquire POS finance facilities to enable them to offer finance to customers purchasing vehicles, and earn commissions on the customer finance contracts they arrange.

Sims added that the merged Esanda and Macquarie entity would likely face competition from Westpac and its subsidiary St George and manufacturer-aligned finance providers, as well as pressure from vehicle manufacturers, which will ensure that their dealers’ finance offers remain competitive with those of other dealers.