The creation of TabTatts will take a little longer to sort out.
October 18 is out as when Tatts shareholders will meet – sometime in November looks possible, or early December, and a finalisation by December 31 is possible (so get your proxies in if going away on holidays).
Justice John Middleton, the president of the Competition Tribunal, yesterday granted Tabcorp a speedy re-hearing of its application to approve the merger over the protests of the ACCC, the competition regulator and James Packer-backed corporate bookmaker CrownBet (owned by Crown Resorts).
But the dates set down by Justice Middleton — October 24 and 25 — are after a proposed meeting where Tatts shareholders are to vote on the deal, on October 18, and clash with the date by which Tatts hoped to get court approval, October 24.
The meeting and court approval date will need to be rescheduled, Justice Middleton said yesterday.
“This is unavoidable because the tribunal must consider all matters that need to be considered now that the matter is back before the tribunal,” he said.
If the tribunal again approves the deal it will still be possible to finish the merger before Tabcorp’s offer expires on December 31.
A re-hearing is necessary because of a Full Federal Court finding last week that an earlier decision by the tribunal waving the deal through with minimal conditions was void due to a legal error.
The court decision left Justice Middleton unsure whether the tribunal had the power to reconsider its original decision.
Yesterday he said he had formed the view that he did have the power — but to make sure the process would be bulletproof he suggested Tabcorp make a fresh application, to be heard at the same time as the re-hearing of the original decision.
“We’ve got to proceed as quickly as we can but with all due process,” he said, according to a report in News Corp papers.
He flagged he might restrict the ability of intervening parties, including the James Packer-backed CrownBet, to cross examine witnesses. "I was very generous [in the original application process] in allowing the intervenors in taking a full role," he said. "I’m not currently disposed to allow the intervenors to have this same ‘open-door’ policy."
“We will endeavour to make a decision one way or another immediately,” he said. This of course doesn’t take account of a further appeal from the ACCC back to the Federal Court.
The combined market value of the two companies is now $9.5 billion against the putative value of $11 billion when the merger was announced last October.
The deal valued Tatts shares at $4.34 – they are now 4.06, while Tabcorp shares were valued at $4.89, now $4.33. The $1.5 billion drop in value is why the deal will have to be recast to win Tatts shareholders’ approval.
