After more than 18 months, ANZ finally has its prize and can buy Suncorp’s banking division. Sorting out the winners and losers isn’t as clear cut as it seems.
Already a subscriber?And on the 583nd day, one of the longest-running M&A sagas in recent corporate history was finally resolved, with a victory for pragmatism over theory., the Australian Competition Tribunal has dismissed the central argument from the Australian Competition and Consumer Commission that the deal would increase the ability of the four major banks to co-ordinate the suppression of competition.
Rightly or wrongly, this deal has been seen as a legacy-maker for Elliott, his big roll of the dice to win back mortgage market that ANZ lost when it mismanaged the COVID-19 home loan frenzy.But whether ANZ and Elliott can be declared winners from the ACT’s determination isn’t as clear-cut as it might seem.
If we accept that ANZ has paid up for Suncorp, and perhaps overpaid, then the market’s focus will be on the synergies that can be extracted from the deal. But remember, to get this deal over the line ANZ promised the Queensland government it will not cut jobs or branches for three years. So any immediate synergies – such as bringing Suncorp’s customers on to the low-cost, but still-immature, ANZ Plus platform – will be relatively harder to find.
ANZ’s market narrative has just changed, and it is too early to say whether it has changed for the better.whose decision to end Suncorp’s history of running a combined bank and insurance company was unquestionably the right one.Climate change means the insurance business has simply become complex enough, and in ANZ, Johnston found a buyer willing to pay a fair-to-full price to take his subscale bank off his hands.
But for Bendigo and Bank of Queensland, the regional banking sector’s biggest straggler, the ACT ruling may represent a ray of hope, in that it appears to open the door to more potential mergers, or takeovers, between a regional bank and a larger rival.
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