Viva Energy Offers Divestiture to ACCC for OTR Acquisition

Viva Energy has submitted a proposal to the Australian Competition and Consumer Commission (ACCC) for a legally binding divestiture in connection with its planned acquisition of OTR Group. Viva Energy and its affiliates run a national fuel network, including Coles Express convenience stores, across all Australian states and territories.

OTR, mainly active in South Australia and also in other regions like the Northern Territory under the Puma brand, is a fuel and convenience store chain. The ACCC is examining if Viva Energy’s divestiture offer sufficiently mitigates concerns about retail fuel supply competition in South Australia, potentially offsetting the competitive impact of the acquisition, according to ACCC Commissioner Stephen Ridgeway.

The proposal involves Viva Energy selling 24 Coles Express sites in Adelaide and another in Ceduna, Eyre Peninsula, to a buyer approved by the ACCC. Viva Energy suggests Chevron, with one retail location in South Australia, as the buyer. The ACCC is gathering input on whether Chevron’s acquisition would create a viable, independent competitor to the merged Viva-OTR entity.

While the ACCC is open to public consultation on this divestiture proposal, it doesn’t imply that any remedial action will be ultimately accepted. Chevron is not yet confirmed as a suitable buyer for these assets.

The ACCC is accepting feedback on this proposal until 27 November 2023. Viva Energy initially planned to divest 23 of its 32 Adelaide retail sites but increased this to 24 in Adelaide plus one on the Eyre Peninsula, responding to ACCC’s concerns.

Viva Energy, as a comprehensive fuel company, operates a nationwide supply chain, including refining, importing, wholesaling, distributing, and retailing, and is the exclusive provider of Shell-branded products in Australia. OTR Group, predominantly active in South Australia and other areas, offers fuel and convenience retailing, along with wholesale fuel and distribution services through its subsidiaries. The proposed acquisition aims to combine their retail fuel, wholesale fuel, and retail convenience and grocery operations.

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