ACCC again blocks sale of RAC WA's insurance arm to Sydney
The Australian Competition and Consumer Commission (ACCC) has blocked the $1.35 billion sale of RAC WA's insurance arm to IAG. The regulator argues the merger would reduce market competition and lead to higher insurance premiums for consumers.
Why it matters
This decision highlights the regulator's commitment to preventing market consolidation that could negatively impact consumer pricing in the insurance sector.
RAC WA had been looking to sell its entire insurance operations to IAG in a $1.35 billion deal. ( ABC News: Jake Sturmer )
The competition regulator has again blocked the sale of RAC to the east-coast-based IAG, saying it would reduce competition in WA's insurance markets and increase premiums.
The RAC maintains that members would be better off under a national insurer that would "strengthen RAC's ability to respond to a changing insurance landscape" and reduce the risk it carries alone.
IAG will now lodge a public benefit application with the watchdog, which will then decide whether any public benefit from the acquisition would outweigh the detriment.
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