PROJECTS

Rest-Home Operator Expansion on Housing, New Zealand

The problem

A rest-home operator in New Zealand wanted to expand its business by acquiring a competitor’s facilities. The Commerce Commission could block the rest-home operator housing expansion if it was concerned that this would reduce market competition. The operator wanted to know how the purchase would affect its market position, and whether the Commission was likely to question the purchase.

How we helped

We determined that the Commission was unlikely to block the housing expansion. We identified the relevant market, gathered market data, calculated the operator’s market share after the rest-home operator housing expansion purchase, and compared this to the Commission’s safe harbor for market share. The rest-home operator’s new market share would be 20 percent, well below the Commission’s safe harbor limit of 40 percent.  

Impact

Castalia’s advice reassured the rest-home operator that it could go ahead with the purchase, expand its business, and would not have to face questions about lessened competition.  

The client

Bupa Care Services

expert evaluation on rest-home operator housing expansion program in New Zealand

Our team

Alex Sundakov

Alex Sundakov

Executive Director

How can we help you?

How can we help you?