The Australian Competition and Consumer Commission (ACCC) has approved two bidding proposals to lease the Port of Melbourne for a period of 50 years.
The approval, given to IFM Consortium and QIC Consortium, has been granted following a review conducted by ACCC, focusing on cross-ownership interests in the Port of Melbourne, NSW Ports, and the Port of Brisbane.
Furthermore, vertical relationships with port services providers operating at the Port of Melbourne were also taken into consideration before granting the approval.
Australian Competition and Consumer Commission chairman Rod Sims said: “The ACCC conducted extensive inquiries with a large number of port users and stakeholders at various levels of the supply chain.
“The ACCC has formed the view that neither acquisition would result in a substantial lessening of competition.
“While there are a small group of exporters in southern New South Wales (NSW), particularly in the Riverina region, who have the option of using Port Botany or the Port of Melbourne, the vast majority of port users have no choice, for them the Port of Melbourne is a monopoly asset.”
ACCC noted that the proposed regulatory regime to apply at the Port of Melbourne will be supervised by the Victorian Essential Services Commission and will cap fees and prices for port users for the first 15 years of the lease.
Following the approval, IFM Investors, which leads the IFM Consortium, holds a 35% interest in NSW Ports and a 26.7% interest in Port of Brisbane.
APG Asset Management, part of IFM Consortium, holds a 4.4% indirect interest in DP World Australia.
QIC Private Capital, which leads the QIC Consortium, manages a 26.7% interest in Port of Brisbane on behalf of its managed clients.
A member of QPC Consortium holds a 24.4% indirect interest in DP World Australia, while QPC is managing that member’s 20% interest in the Port of Melbourne.
Currently, the Port of Melbourne handles around 2.6 million containers annually and around 3000 ship visits the port every year.