Expiry of Armaguard-Prosegur Merger Undertaking Opens New Regulatory Phase for Cash in Australia
Key Facts
Australia’s current regulatory developments do not represent a new approval of the Armaguard-Prosegur merger. The Australian Competition and Consumer Commission cleared the deal on 13 June 2023 after accepting a court-enforceable undertaking. The two companies were the country’s largest providers of cash-in-transit services, including the transport, management and processing of money for banks, retailers and independent ATM operators. The commission said it was “not satisfied that the proposed merger would not substantially lessen competition.” It nevertheless cleared the deal after concluding that the likely public benefit would outweigh the likely competitive harm, subject to compliance with the undertaking. The matter before regulators in 2026 therefore concerns the regulation of ongoing cash distribution and pricing, not a reconsideration of the merger.
The original undertaking addressed a difficult equation in a market undergoing structural decline as cash use as a means of payment falls. The commission then considered it likely that either Armaguard or Prosegur would exit the market in the near term without the merger, and that a rapid withdrawal could cause disruption and limit access to cash for customers and the public. At the same time, combining the two largest providers in one entity raised concerns about reduced competition in services on which banks and retailers rely. The undertaking therefore required the merged entity to continue providing cash-in-transit services to locations it served and to make certain equipment available to competing providers. These obligations lasted 3 years from the date of approval. Linfox, Armaguard’s parent company, was to own 65% of the issued capital, while Prosegur was to own 35%.
The undertaking linked to the merger clearance expired on 4 September 2026, as the sector moved to a new regulatory regime. The Cash Distribution Framework Act took effect on 27 August, and the Reserve Bank of Australia designated Linfox Armaguard as a regulated entity on 3 September. The framework gives the competition commission the power to issue interim directions during its first 24 months in force. This marks a shift from a time-limited undertaking imposed as a condition of the deal to new regulatory oversight addressing the continuity of distribution services. The transition’s central concern is ensuring that banks, retailers and customers retain access to cash services and facilities.
On 29 September, the commission said it was seeking views from banks and retailers on a transitional undertaking proposed by Linfox Armaguard, which the company submitted on 23 September. The proposal covers prices, services, national coverage and third-party access to cash centres. The commission said it would decide whether to accept the undertaking after reviewing the responses, and set 16 October as the closing date for consultation. The proposal was designed to remain in force for the shorter of 24 months or the date on which the commission approved the standard terms under the Cash Distribution Framework Act. Commission chair Gina Cass-Gottlieb said “reliable and sustainable access to cash remains important for many consumers and businesses,” describing the consultation as a step toward a sustainable long-term system.
The measures come as Reserve Bank of Australia data show that cash remains part of daily life, despite its diminished role in recent years. Cash accounted for about 15% of the number of payments in 2025, compared with about 13% in 2022, while its share of payment value was about 8%. The bank reported that about half of Australians used cash during a typical week, and that nearly a third could face significant hardship or inconvenience if they could not access or use it. The Treasury also announced that grocery stores and petrol stations would be required to accept cash for essential purchases from 1 January 2026, with exemptions for some small businesses. This places the continuity of cash-in-transit and distribution services at the centre of the ongoing regulatory transition.