Victoria-based Tabcorp and Queensland-based Unitab are the only two gaming companies that offer pooling services to totalisators in other smaller states so that bets can be combined and odds balanced out.
ôIt would not be viable for [these smaller totalisators] to operate without access to pooling services as their individual pools arenÆt of sufficient size to limit the potential variance in totalisator odds occurring when larger bets are made,ö the ACCC says.
The watchdog says it will make a final ruling on the merger on August 16 and has asked for public feedback on its concerns.
It listed a number of other reservations including a possible decrease in the bet types offered to punters and a drop in the quality of phone and internet banking services.
Tabcorp, which launched its A$14.25 per share offer for Unitab in early June, is attempting to keep the deal alive and has provided the ACCC with a draft undertaking not to discriminate against pool members.
The company has promised to give its pool members the right to terminate their agreements with three months notice and to renegotiate for more favourable terms. If a pool member is successful in these negotiations, the same terms must be offered to other pool members.
Tabcorp has also agreed that if and when it wins the Victorian wagering licence due for review in 2012, it will sign new agreements with pool members on the same or better terms than current conditions.
The company still has a number of hurdles to clear before its current offer for Unitab expires on August 30. The biggest hurdle is convincing Unitab shareholders that the merger makes sense.
If Tabcorp is successful in its bid it will create a A$12 billion betting, casino and poker machine business. Tabcorp will control more than 90% of all money spent on horse, greyhound and other races.