ACCC Raises Concerns Over Louis Dreyfus Acquisition of Namoi Cotton

The Australian Competition and Consumer Commission (ACCC) has raised concerns regarding Louis Dreyfus Company's (LDC) proposed acquisition of Namoi Cotton Ltd (ASX: NAM). The ACCC's Statement of Issues highlights potential competition reductions in cotton ginning services in northern Western Australia and the Northern Territory, and cotton lint classing services in Australia.

LDC and Namoi operate cotton gins and provide related services, including marketing and logistics. The ACCC worries that the acquisition would grant LDC control over the only two cotton gins in the specified regions, reducing competition and potentially leading to higher prices and lower service quality.

Additionally, the ACCC is evaluating whether the acquisition could hinder access to cotton lint for rival merchants and impact warehousing service costs. The ACCC invites public submissions by May 30, 2024, to address these concerns.

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