The Australian Competition and Consumer Commission has released today preliminary findings on Bain Capital’s proposal to combine Camp Australia Pty Ltd (Camp Australia) and Junior Adventures Group (JAG).
Camp Australia and JAG are the two largest commercial suppliers of before and after school care in Australia. JAG owns the OSHClub and Helping Hands brands.
“The ACCC’s primary concern is that the loss of competition between Camp Australia and JAG for the supply of before and after school care could result in higher prices for parents and lower quality care for students in some states,” ACCC Chairman Rod Sims said.
“The ACCC has received extensive feedback from interested parties, including schools and parents, expressing concern about the proposed acquisition.”
The ACCC’s primary concerns relate to the parties’ Victoria, Western Australia, New South Wales, and Queensland operations where there is the greatest overlap.
It is also continuing to investigate the effect of the proposed merger in the Australian Capital Territory and South Australia.
“The merger may also damage the interests of primary schools, who rely on competition between Camp Australia and JAG, to obtain the best possible deal for use of the school’s facilities,” Mr Sims said.
Although there are a very large number of before and after school care providers throughout Australia, the vast majority of them are very small operators. The merged Camp Australia-JAG would be much larger than any of its competitors.
“The ACCC’s preliminary view is that the competitive threat of expansion by smaller players, or potential new entry into the industry, will not be sufficient to prevent the exercise of market power by the combined Camp Australia-JAG after the acquisition,” Mr Sims said.
“There has been a high level of interest in the acquisition and we welcome feedback from all interested parties on the issues we have outlined.”
The ACCC invites further submissions from interested parties in response to the Statement of Issues by 25 August 2017. The ACCC’s final decision is expected to be announced on 26 October 2017.
The Statement of Issues is available on the public register: Camp Australia Pty Ltd and Junior Adventures Group Pty Ltd – proposed merger