ACCC Not Opposing Fertilizer Venture

SYDNEY - Mar 2/05 - SNS -- The proposed fertilizer joint venture between Futuris Ltd and AWB Ltd (and their subsidiaries Elders and Landmark) will not be opposed by the Australian Competition and Consumer Commission (ACCC).

Neither will the commission oppose the joint venture's acquisition of shares in HiFert Pty Ltd from WMC Resources Ltd, ACCC Chairman, Graeme Samuel, announced today.

In assessing the joint venture and acquisition the ACCC received a number of submissions that expressed concern that the arrangements could allow Landmark and Elders to use bundling, cross subsidization of products and other incentives to achieve a higher market share in the wholesale and retail markets for fertilizer.

After considering a number of factors including the high level of market share currently held by Incitec Pivot, the presence of other retailers and buying groups and the high level of imports across the range of fertilizer products, the ACCC decided that suppliers, retailers and farmers would be able to turn to alternative sources as well as respond competitively to initiatives by either Elders or Landmark resulting from the joint venture.

Elders and Landmark also provided information to the ACCC which supported their assurance that both will continue to compete with each other at the retail level.

The ACCC also noted that WMC Resources will retain a third share in HiFert which imports and produces fertilizer and HiFert will be able to continue separately marketing fertilizer to retailers other than Elders and Landmark.

On that basis the ACCC formed the view that the joint venture and subsequent acquisition was not likely to result in a substantial lessening of competition. The ACCC intends to issue a public competition assessment on this matter in the near future.