The ACCC will assess the impact of IOOF’s purchase of MLC on the financial services market before the sale can go ahead, IOOF confirmed on Monday.
IOOF had made a submission to the competition watchdog for an informal merger clearance, insisting the consolidation will deliver benefits for members, investors and advisers.
The ACCC will be focused on the impact of the acquisition on competition across investment platforms for superannuation and other retirement income, retail investment platforms for wealth management and financial advice.
The regulator has invited submissions from interested parties until 9 November, seeking views on how closely the two companies compete, the likely effect of a merger on fees and service levels in their overlapping areas and the impact on fees and services levels in delivering financial advice.
For now, the ACCC is planning to declare its findings of the review on a proposed date of 4 February next year.
But IOOF does not expect any change to its estimated completion date for the deal, with it anticipating a wrap-up before June next year.
The deal could possibly see the group become Australia’s largest retail wealth manager, with around $510.4 billion in funds under administration, advice and management, as it adds MLC’s businesses across advice, platforms and investment management.
It will also potentially double its total number of clients to 2.2 million and more than triple its advisers to 1,884, assuming all MLC advisers transfer over.
The MLC platforms would also push IOOF to the top in terms of funds under administration, with $196 billion, ahead of BT, AMP and Colonial First State’s platforms.
Meanwhile, in superannuation, the $103 billion in funds under administration it would gain from MLC would see it grow to $173 billion, placing it ahead of AustralianSuper’s $172 billion and second only to QSuper and Sunsuper’s $188 billion when they merge.
The transaction is also subject to regulatory approval from APRA.
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