Australia’s consumer and competition regulator (ACCC) has announced it will not oppose hearing aid giant Cochlear (ASX:COH) from acquiring a Danish rival’s technology – so long as Cochlear does not buy its bone conduction tech.
In 2022, Cochlear told the regulator it intended to buy a cochlear implant business called Oticon Medical from a company called Demant.
This threw up red flags for the regulator, which perceived competition risks related to potential dominance Cochlear could adopt in ‘bone conduction solutions’ specifically.
Bone conduction can come in the form of non-surgical highly priced headphones, or, surgical implants. Cochlear’s ‘Baha’ implants use bone conduction and Cochlear is one of the largest players offering the tech in the southern hemisphere.
“We concluded that Cochlear’s proposed acquisition of Oticon’s cochlear implants business was unlikely to substantially lessen competition in Australia,” ACCC chief Stephen Ridgeway said.
However, that didn’t stop the regulator from preventing Cochlear from picking up Demant’s bone conduction tech specifically.
“The transaction has now been changed to remove the bone conduction solutions business, which addresses the significant concerns the ACCC had in relation to bone conduction solutions,” Ridgeway added, in a comment that can only be described as eyebrow-raising given the regulator simultaneously saw no risk to Australia’s medtech landscape.
Perhaps other countries’ regulators were influential in that decision.
The ACCC cited liaison with other regulatory agencies globally as the proposed deal also set off alarm bells in the EU and UK.
COH shares were up 0.8% to $333.23/sh at market open according to Cboe live pricing.