Given your last statement, I still don't see that the proposed change to a small part of the over-all freight task, is anti-competitive.Agreed but I did say "if there was a genuine bidder". If no-one is interested then fine, shut it down but if another operator is prepared to offer $$$ for it but Aurizon shuts it down because of some cosy deal that they have made with PN to reduce the chance of another competitor getting a foothold in the market then that is a different story. (note I am not alleging this is what is happening, merely theorising that it would be a possible scenario).Hi Sulla, as someone who is no where near as familiar with this as you i was wondering if it is possible that the ACCC could get an injunction forcing Aurizon to sell the Intermodal business as a going concern if there is a genuine bidder on the grounds that to simply close it would substantially lessen competition
And if they did is there actually anything left to sell or has the horse bolted?
There's a possibility the ACCC might attempt to do this...but it may well set an unworkable precedent where any company trying to shut down an "unprofitable operation" could be prevented from doing so in the name of competition. A lot of industries have closed or moved offshore in the last decade without interference from the ACCC - Aurizon being singled out for special treatment based on a clearly documented commercial decision might not wash with the Federal Court (in saying that I don't think Queensland intermodal is as unprofitable as Aurizon has made it out to be). The horse has probably bolted and the ACCC has probably managed to shoot it dead instead of saving it.
I can understand why, for instance, GM didn't want to entertain selling it's Elizabeth plant in Adelaide to Sanjeev Gupta for him to build EVs in as that would be giving a leg up to a direct competitor but in this case Aurizon are exiting Intermodal altogether so why would they not maximise return for investors by trying to sell the business as a goer. I can think of 3 scenarios.
1/ They tried to offload it behind closed doors and no one was interested (unlikely)
2/ They don't want to give any other operator a leg up in Qld in case they establish a base and then come after their other business
3/ They did a deal with PN to share the spoils and keep other operators out.
The heart of the ACCC investigation appears to be whether Aurizon and PN did a deal to reduce competition, so Option 3 is a component of the scenario. From what I recall, the PN bid was unsolicited and above the market value. In hindsight Aurizon and PN were probably kidding themselves that the ACCC wouldn't step in. I guess the ACCC wants to prove that this is blatant market ring-fencing rather than being about the best cash deal.
I suspect the ACCC's contention that Qube was "interested" may be an exageration, Qube has had plenty of opportunities to establish itself in the Queensland rail market, but has chosen to buy trucks instead of locomotives. And, as Watco demonstrates, you don't have to sit around waiting for Aurizon hand-me-down rollingstock to enter the Queensland market, just get a contract and buy what you need. In the end, my take is that the PN/Aurizon deal would have preserved the existing traffic task on rail, and if anyone else wanted to enter the market they could spend money (like PN has) to do so - there's still forty trains worth of trucks per day on the Bruce Highway.