ACCC approves AGL, APG deal

Competition watchdog says acquisition won't affect energy sector.

The Australian Competition and Consumer Commission (ACCC) has given the green light to AGL Energy's (AGL) takeover of Australian Power and Gas Company (APK).

In a statement, the competition watchdog said the acquisition was unlikely to substantially lessen competition in Victoria's energy sector, where APG primarily supplies electricity and gas.

The ACCC said there were a number of second-tier retailers in the Victorian energy retail market that would continue to drive competition.

“The ACCC formed the view that the removal of APG as an independent retailer was not likely to substantially reduce the competitiveness of price and non-price offerings in the relevant retail energy markets," ACCC chairman Rod Sims said.

"The ACCC is very concerned to ensure that acquisitions in the energy sector do not result in the removal of second tier retailers that play a significant role in driving pricing, discounting activity or innovation in energy offerings.

“However, after a close review, it became apparent that the removal of APG was not likely to substantially reduce the overall competitiveness of the relevant markets.”