Iron Mountain must sell Australian unit: Australian regulator

Leading US data storage and information management provider Iron Mountain Inc will sell its Australian unit in order to gain regulatory clearance for its A$2.7-billion ($2 billion) acquisition of its Australian rival Recall Holdings Ltd.

The Australian Competition and Consumer Commission (ACCC) today said in a statement that ''the proposed undertaking would involve Iron Mountain divesting its existing Australian business, excluding its local records management customers in the Northern Territory as well as its data management business.

Giving reasons for enforcing the divesture, the ACCC said that the proposed acquisition would likely to substantially lessen competition in a national market for the supply of physical document management services.

The proposed acquisition is also being reviewed by anti-trust authorities in the US, the UK and Canada.

In April last year, Iron Mountain offered to buy its Australia-listed rival Recall Holdings in a cash-and-stock deal valued at approximately $2.2 billion. (See: US data storage firm Iron Mountain to buy rival Recall Holdings for $2.2 bn)

In November, ACCC said that it may block the deal since the proposed acquisition would give it 71-per cent market share and leave customers "vulnerable to price increases or reduced service levels".

Atlanta-headquartered Recall, established in 1999 by Sydney-based logistics group Brambles Ltd, is a leading provider of information management and protection services to around 80,000 customers in diverse sectors in 24 countries. The company has corporate offices in Brazil, the UK, Malaysia, and Australia and has over 300 operations centers across the globe.

Recall was demerged from associated logistics services provider Brambles in 2013.

Boston-based Iron Mountain provides records management, information destruction and data backup and recovery services to over 156,000 customers across North America, Europe, Latin America, and Asia.

The company has over 1,000 facilities in 36 countries. 

New York-listed Iron Mountain said it would establish a secondary listing on ASX to allow local trading of its shares by Recall investors.

Iron Mountain has operations in every state and territory in Australia, while Recall has a presence in every state and territory, except the Northern Territory.