ACCC Raises Concerns Over DP World’s Acquisition of Silk Logistics

The Australian Competition and Consumer Commission (ACCC) has raised concerns regarding DP World’s proposed acquisition of Silk Logistics, citing potential competition issues.

Silk Logistics currently operates 21 logistics hubs and 25 warehousing facilities across five Australian states. If the deal goes through, Silk would become part of DP World Australia, which manages four container terminals and three container parks in Brisbane, Sydney, Melbourne, and Fremantle, along with inland distribution centers and warehouses.

On average, DP World Australia handles around one-third of the containers passing through these ports.

ACCC’s Competition Concerns

The ACCC has flagged potential risks, stating that DP World’s control over a national container transport provider could reduce competition, leading to higher costs and diminished service quality for Australian importers and exporters.

Philip Williams, ACCC Commissioner, also noted that the regulator is investigating whether DP World’s ownership of Silk could provide access to commercially sensitive data about Silk’s competitors.

Acquisition Details & Next Steps

DP World, a Dubai-based global ports and logistics operator, announced a deal to acquire Silk Logistics for A$174.5 million ($115.6 million) or A$2.14 per share in November 2023. The Silk Logistics board has unanimously recommended that shareholders approve the transaction.

The ACCC is inviting submissions from interested parties until March 27 and is expected to release its findings in early June.