The Competition and Markets Authority (CMA) has faulted the merger and acquisition deal between S&P Global and HIS Market over competition concerns. The competition watchdog stated that it is prepared to give a node to the deal if they address competition concerns in certain commodity price assessments.
CMA Sees A Slight Competition Concern In The Merger
Both companies are in the process of completing a £32 billion merger deal. However, the process will not be complete until they meet the requirements. The competition concerns are about some markets where the companies operate.
However, the CMA stated that its initial investigation revealed “limited” concerns because both companies operate complementary activities. Also, the watchdog noted that the combined presence of both companies does not have a noticeable impact on others in the market.
But in some markets, the watchdog said both companies’ presence could be relatively significant, which can affect competition.
Colin Raftery, CMA senior director, stated that the merger deal could raise competition issues in markets related to the supply of certain commodities’ price assessment in the United Kingdom.
He added that the regulator is worried that the reduction in competition can result in worse outcomes for customers. However, the CMA is prepared to clear the merger if the concerns are addressed.
CMA Gives Both Firms Five Days To Send A Proposal
Apart from the CMA, other competition regulators are also reviewing the deal. The CMA also said that it is consulting with other regulators to come up with a unified response and decision regarding approving the merger.
In response to the regulator’s statement, both S&P and HIS said they are working on a proposal that will convince the CMA that the merger will not affect competition. They have been given five working days from the day of the announcement to submit a proposal.
HIS and SPGI have previously deliberated on the divestitures of some HIS businesses in a bid to certify the CMA’s concerns when it comes to petrochemical price assessment in the UK.
The parties have agreed on terms to sell the Metals, Coal, Oil Price Information Service (OPIS), and PetroChem Wire businesses to News Corp. However, the deal is subject to regulatory approval.