According to Australia's antitrust regulator, BHP Billiton Ltd's USD 142 billion hostile bid for Rio Tinto Group in the world's biggest mining takeover may raise competition concern for the global supply of iron ore.

The Australian Competition and Consumer Commission in a statement said that “The merged firm may have the ability and incentive to influence global supply and prices for iron ore.”

Ms Samantha Evans a Melbourne based BHP spokeswoman said that “We note the ACCC's announcement and we are continuing to engage constructively with the commission on this matter.''

The regulator is seeking further industry submissions by September 5th and will give a decision by October 1st 2008.

European Union antitrust regulators widened a probe of the proposal last month, saying they have serious doubts' about the combination that would control more than a third of global iron ore, the main ingredient in steel. BHP has targeted USD 3.7 billion in cost savings and increased sales from the takeover.