Brookfield's revised $9b Asciano takeover plan rejected by WA farmers

Western Australian farmers will reiterate their opposition to Brookfield Infrastructure's $9 billion plan to acquire ports and rail group Asciano when they make fresh submissions to the competition watchdog this week.

The Australian Competition and Consumer Commission has called for public comment on new proposals from Brookfield, which include the sale of Asciano's Pacific National's intermodal freight business, after its initial takeover plan was rejected

WA farmers don't want Brookfield to control both rail tracks and haulage services
WA farmers don't want Brookfield to control both rail tracks and haulage services Photo: Jessica Hromas

Dale Park, president of the WA Farmers Federation, said Brookfield's plans to divest the intermodal business were not sufficient to assuage competition concerns.

The infrastructure group should sell its 5500-kilometre freight rail track network if it wanted to acquire Asciano, he said.

"Our original position still stands," Mr Park told The Australian Financial Review. "We think they should give up the rail." 

Co-operative CBH Group, the nation's biggest grain exporter, also plans to make a submission to the ACCC this week before the regulator's Friday deadline for public comment. 

Pacific National's intermodal freight operations include haulage services for grains, steels and cars. It does not include Pacific National's coal haulage operations in Queensland and NSW.

Seeking approval

The proposals come as Brookfield tries to secure ACCC approval for the proposed takeover after the regulator turned down an earlier plan to provide "behavioural undertakings" to ease concerns it could abuse its market power. 

ACCC chairman Rod Sims has said the regulator will consider the feedback from users of Brookfield's and Asciano's services in Western Australia and Queensland when making a final decision on the takeover proposal.

Mr Sims has already warned that while Brookfield's revised plan to sell Pacific National's intermodal business addressed vertical integration concerns in WA, it would not stop Brookfield trying to haul agricultural commodities on its rail networks in future.

Brookfield's rival suitor for Asciano, logistics group Qube, is finalising discussions with its partners – the Canada Pension Plan Investment Board and Global Infrastructure Partners – over making a competing formal offer.

Qube has to date only made an indicative bid but has submitted its takeover proposal to the ACCC for review. 

The ACCC intends to make a final decision on both Brookfield's and Qube's takeover proposals by February 18.

Brookfield has formally opened its bid to Asciano shareholders, but cannot close its offer until it receives clearance from the regulator.

Brookfield is keeping all options open, and has been slowly extending its offer by the minium required period of one week, with the offer currently scheduled to close on January 29. It will continue extending the offer as necessary.

Asciano's board has previously recommended investors accept Brookfield's bid, because it is the only formal bid that has been received. If the board receives a formal bid from the Qube consortium, it will have to choose between the two cash and stock offers, which are of similar value.

Asciano's shares closed on Friday at $8.48.