MYOB Bid For Reckon Doomed?
Accounting software house MYOB’s proposal to acquire rival Reckon for $180 million appears likely to fail, according to Australian analysts at investment bank UBS.
They say MYOB will struggle to convince the industry regulator, Australian Competition & Consumer Commission, that absorbing Reckon’s accountants practice management business won’t limit choice for consumers.
“If MYOB has a monopoly on this software, it would substantially lessen competition. We think there’s a significant risk for customers that prices will increase and service levels will decrease,” the analysts say.
UBS analyst Tom Beadle told Australian IT that MYOB must either make specific undertakings to placate the ACCC or hope that the regulator changes its market definition.
He said the ACCC is unlikely to tweak its definitions and any undertaking from MYOB would defeat the point of it buying Reckon’s accounting business.