The Australian Competition and Consumer Commission said the sale of Glencore’s GRail was a rare opportunity to boost competition in the rail business in the Hunter Valley, Australia’s top coal-exporting region. Glencore has attracted several bids for its GRail business, the third-largest coal haulage business in Australia, including from Aurizon Holdings, Pacific National and Genesee & Wyoming Inc. The transaction could fetch as much as A$1.5 billion ($1.1 billion).
“The Hunter Valley coal haulage market appears to have high barriers to entry, so we would expect the addition of a third competitor to have a significant effect upon the market,” commission Chairman Rod Sims said.
The commission also said market participants had raised concern that if Aurizon or Pacific National, which is the biggest coal hauler in the Hunter Valley, were to take over GRail, it would lessen competition in the region.
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