The ACCC has launched a public review after Sigma Healthcare offered concessions to facilitate its proposed $8.8 billion merger with Chemist Warehouse.

The competition watchdog is seeking feedback from stakeholders on whether the draft undertaking offered by Sigma can address the competition concerns arising from the deal.

Sigma entered an agreement to acquire Chemist Warehouse last December, in exchange for Sigma shares and $700 million cash. The deal would bring Chemist Warehouse onto the ASX through Sigma.

Upon completion of the merger, Chemist Warehouse shareholders will hold 85.75 per cent of the ASX-listed merged entity while Sigma shareholders will hold 14.25 per cent. 

In a statement issued in June, the ACCC said the merger would result in a “major structural change” for the pharmacy sector. It also poses a range of competition concerns, including the potential harm to pharmacies currently supplied by Sigma and the potential for Chemist Warehouse to access these pharmacies’ data in ways that damage competition.

In response, Sigma said it would allow franchisees of the Amcal, Discount Drug Stores and Guardian brands to terminate their agreements with the company for a period of three years if the deal goes ahead. In such cases, it will waive its right to recover contributions already made and future fees.

The company also offered to restrict the collection and use of confidential data and information from Sigma wholesale customers and franchisees.

The ACCC will receive submissions on the proposed undertaking by October 14. The regulator has also delayed its ruling on the deal by another two weeks, from October 24 until November 7.