CC Clears Fuel Distribution Merger
The Competition Commission (CC) has found no copetition concerns over DCC Energy UK Limited’s completed acquisition of heating and transport fuel distribution businesses previously owned by Total Downstream UK plc.
This confirms the CC’s provisional findings, which were published in July.
DCC, which operates GB Oils, bought these businesses in September 2011 from Rontec LLP Limited, which had previously bought them from Total in June 2011. The acquisition included the Butler Fuels oil distribution business (which sells and distributes heating and transport fuels to domestic and business customers) and the contractual right to supply transport fuels to a number of dealer-owned, dealer-operated retail service stations currently under the Total brand.
Distribution businesses generally deliver to customers that require smaller delivery volumes than customers of oil majors and traders (that mainly deliver in large, articulated tankers).
The CC has found that the range of customers supplied by these businesses will not suffer from a substantial lessening of competition as a result of the acquisition:
Customers with large load requirements, such as service stations, will continue to have a range of supply options.
Local customers with smaller requirements will face a reduction in choice in some areas but the ease of small-scale entry for other companies would counteract this.
Customers requiring smaller loads across a number of sites (multi-site non-bulk) can and already do source from a number of suppliers and most are prepared to switch in response to price rises.