Papua New Guinea's consumer regulator, the Independent Consumer and Competition Commission (ICCC), has denied Westpac's sale of its Pacific business to Kina Securities.
Kina Securities was set to pay $420 million for Westpac Fiji and 89.91% of Westpac PNG Limited which combined have net assets of $480 million, net loans of $1.57 billion and deposits of $2.34 billion.
The transaction will no longer be able to go ahead, and Westpac will retain the Pacific business, which it announced it was offloading in December.
The transaction was subject to regulatory approvals in both Fiji and Papua New Guinea. In July, the ICCC released a draft determination indicating it proposed to deny the transaction.
|Sponsored by iShares|
Invest for the long term with iShares ESG ETFs.
"Currently, the markets are highly concentrated; and will remain so, as long as there are only few players in the markets," ICCC commissioner and chief executive Paulus Ain said.
Westpac said it acknowledged the ICCC's determination and will continue to operate these businesses while it reviews the impact on the sale to Kina Bank.
The transaction was supposed to be made up of $315 million payable at completion while $60 million will be paid six-monthly over 18 months for Westpac PNG.
The price included $45 million of earn-out payments which would have occurred annually over two years following completion and based on the performance of Westpac Fiji.
Kina also said it is assessing the implications of the ICCC's decision not to grant authorisation to the acquisition and is considering its options.