The Aurizon Holdings Ltd (ASX: AZJ) share price is in the red despite a big win for the company's planned acquisition of One Rail.
The $2.35 billion purchase has been given the tick of approval from Australia's competition watchdog.
At the time of writing, the Aurizon share price is $3.75, 2.09% lower than its previous close.
The company is currently its sector's worst performer, helping drag the S&P/ASX 200 Industrials Index (ASX: XNJ) 0.1% lower.
Let's take a closer look at today's major news from the S&P/ASX 200 Index (ASX: XJO) rail freight operator.
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Aurizon share price slips despite ACCC win
The market is bidding the Aurizon share price lower on Thursday despite the company's multi-billion-dollar acquisition passing a notable hurdle.
The Australian Competition and Consumer Commission (ACCC) won't oppose Aurizon's purchase of One Rail if the ASX 200 company divests its east coast business.
One Rail operates the 2,200-kilometre Tarcoola-to-Darwin railway line. It also controls an east coast haulage business in New South Wales and Queensland.
"Without the divestment of One Rail's east coast business, the ACCC considered that the proposed acquisition would reduce the number of main competitors in the supply of coal haulage in New South Wales and Queensland from three to two, likely resulting in higher prices or decreased service levels," ACCC chair Gina Cass-Gottlieb said.
Aurizon now expects to finalise the acquisition by the end of this month. It will get started on the demerger immediately afterwards.
The company plans to integrate the remaining One Rail assets into its bulk business.
Aurizon managing director and CEO Andrew Harding commented on today's news of the "transformative" acquisition, saying:
The transaction secures one of Australia's most important infrastructure assets, connecting regions rich in resources and agricultural commodities with Darwin, the closest port to Asia.
In addition, the business includes bulk haulage operations, facilities, and a 400-strong workforce in South Australia and the Northern Territory to serve existing customers and growth opportunities in base metals, agriculture, iron ore and for new economy metals such as manganese and copper.
The Aurizon share price slumped 6% when Aurizon's planned acquisition of the business was announced in October 2021.
Then, One Rail was described as a "strong, profitable business". It had aggregate estimated earnings before interest, tax, depreciation, and amortisation (EBITDA) of $220 million for 2021.
Around $140 million of that was expected to come from the east coast rail business.
