Stagecoach Application To Acquire Tranz Metro
19 December 2001
Commerce Commission Declines Stagecoach Application To Acquire Tranz Metro (Wellington)
The Commerce Commission has declined New Zealand Bus Limited, commonly known in the Wellington region as Stagecoach, to be a 50% shareholder in a joint venture with Wellington Regional Council to acquire 100% of the assets of Tranz Metro (Wellington).
The Commission reached its decision to decline the application under section 68(2) of the Commerce Act. This section allows the Commission to decline to give a clearance where it considers that the acquisition is unlikely to proceed. In this case, the acquisition could not lawfully proceed.
Commission Acting Chair Paula Rebstock said the Transit New Zealand Act 1989 does not allow the Wellington Regional Council to make payment in respect of any passenger service and at the same time be an owner of a passenger transport company.
"The law as it currently stands prohibits the proposed joint venture company from acquiring the assets of Tranz Metro (Wellington)," said Ms Rebstock.
"This is not a situation where an Act has been passed but is not yet in force, or where there is a Bill before Parliament. Hence, not only is there an absence of certainty about the prospect of legislative change but the content of any such change is a matter of speculation.
"As this proposal cannot proceed under the current legislation, the Commission has declined to give a clearance." Background
The proposed joint venture sought to acquire the assets of Tranz Metro (Wellington).
New Zealand Bus is the 100% holding company for Wellington Transport Limited, Cityline (NZ) Limited and Transportation Auckland Corporation Limited, which companies operate the New Zealand bus businesses known as Stagecoach Wellington, Cityline Hutt Valley and Stagecoach Auckland.
New Zealand Bus is, in turn, a wholly owned subsidiary of Stagecoach Group plc in the United Kingdom.
Tranz Metro (Wellington) is 100% owned by Tranz Rail Limited.