ACCC to investigate MYOB's $180 million acquisition of Reckon

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ACCC to investigate MYOB's $180 million acquisition of Reckon

The Australian Competition & Consumer Commission has commenced a review into MYOB's proposed $180 million acquisition of Sydney-based accounting practice management software firm Reckon.

The acquisition, which was revealed in November, will see Reckon sell its APS, Elite and Docs businesses to MYOB, along with the transfer of 120 employees.

Reckon will retain its business and legal practice management divisions. The acquisition is expected to be finalised in the second quarter of the 2018 financial year.

The consumer watchdog began taking public submissions from interested parties on Friday, focusing on what impact a MYOB-Reckon merger would have on competition in the accounting software market, particularly for medium to large customers.

The ACCC will also look at the availability for customers to procure from alternative software providers and the likelihood of new entrants in the cloud-based software market.

MYOB's has three different operational segments: SME solutions, which provides accounting software; practice solutions, which includes practice software for more than 40,000 accountants; and enterprise solutions, including ERP and HRM software.

The ACCC acknowledged that there was already some overlap in the practice management software market between MYOB and Reckon.

Submissions close on 1 February, with an announcement on the findings expected on 22 March.

The acquisition plans have already copped criticism from one party, with accounting software firm Xero quick to take a swipe at its rival.

Xero's Australian managing director, Trent Innes, questioned whether Reckon's customers would eventually be forced to migrate their legacy services to MYOB's products down the line, unsurprisingly suggesting Xero would be a better alternative.

MYOB's share price has dropped slight from $3.66 prior to the acquisition announcement to $3.57 at the time of writing.

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