The Australian Competition and Consumer Commission is conducting an informal review into the acquisition of Wesfarmers’ underwriting business by
IAG with a view to publishing provisional findings on 27 March.
As reported last month,
Wesfarmers has sold its underwriting arm to IAG for $1.845bn, which includes WFI and Lumley.
A letter by the ACCC states it is considering the proposed acquisition under section 50 of the
Competition and Consumer Act 2010. Section 50 of the Act prohibits mergers and acquisitions that substantially lessen competition in a market, or are likely to do so.
The ACCC is conducting the review under its mergers register. Interested parties can make submissions up until 3 February. A spokesman for IAG told
Insurance Business it has made a submission.
Concerns have already been raised regarding the acquisition with some market observers fearing
it will create a duopoly.
Meanwhile, it is still unclear what will happen to the Lumley executive team as a result of the acquisition. A spokesman for IAG said that it is too soon to comment on such matters and that it would work through it as part of the integration process.
