November 28, 2018 / 11:52 PM / a year ago

Bingo shares plunge as Australian watchdog raises concerns over Dial A Dump deal

(Reuters) - Shares in Australian waste management and recycling company Bingo Industries Ltd (BIN.AX) plunged as much as 13 percent on Thursday after the competition regulator raised concerns about its $422 million acquisition of rival Dial A Dump.

The Australian Competition and Consumer Commission (ACCC) said the deal could have negative impacts on the market for processing, landfill and collections of building and demolition (B&D) waste.

“The acquisition would remove future competition between Bingo’s and Dial A Dump’s dry landfills, which may lead to higher gate fees than would be likely without the acquisition,” ACCC Chair Rod Sims said in a statement.

The ACCC said it would make a final decision on the matter by February 2019.

Bingo’s shares were down 8.4 percent at a one-year low by 2326 GMT, while the broader market was 0.86 percent higher.

Bingo said in a statement it would work with the regulator ahead its final decision.

Bingo had announced the A$577.5 million ($421.7 million) acquisition of its smaller rival in August in a bid to take advantage of a Chinese ban on waste imports. The deal could make the company the biggest waste collector in Sydney, Australia’s most populous city.

China, which took about a third of Australia’s rubbish, earlier this year stopped accepting waste shipments such as plastic and paper as part of a campaign against “foreign garbage”.

Reporting by Ambar Warrick in Bengaluru; Editing by Sonya Hepinstall and Stephen Coates

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