The consumer watchdog will not stand in the way of taxi payment service Cabcharge Australia buying Yellow Cabs in Queensland.
Cabcharge, in February, entered into an agreement to buy Yellow Cabs, one of the two large taxi networks in Brisbane with a market share of roughly 50 per cent, for $20 million, subject to approval from the Australian Competition and Consumer Commission.
The ACCC on Thursday said it believed the acquisition was unlikely to reduce competition.
"The ACCC found that it was unlikely the acquisition would result in Cabcharge foreclosing competition from alternative non-cash payment system providers, as there are a number of alternative systems available and it is drivers who choose which system to use," the ACCC said in a statement.
"Further, the taxi business is being constrained by the popularity of ridesharing services such as Uber.
"While Cabcharge may gain access to competitor pricing and other information, we don't believe this will provide them with a significant competitive advantage," it added.
Cabcharge, which serves as a financial services, taxi payments and passenger transport company, also owns taxi networks in NSW, Victoria and South Australia.
The company's chief executive Andrew Skelton said the acquisition in Queensland will increase the number of cars affiliated with its taxi networks to roughly 8,500 vehicles.
"Demand for motorised trips continues to grow and ultimately remains under-serviced," Mr Skelton said in a statement on Thursday.
"While our industry is undergoing regulatory change and disruption, professional taxi drivers have an important, trusted and long-term role to play providing service to the community and we are committed to supporting them with enhanced technology and nationwide branding and marketing."
The Yellow Cabs operations are expected to contribute approximately $40 million in revenue and $3.5 to $4 million in annual earnings for Cabcharge.
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