OFT OKs Sale of 23 Stores in Builder’s Merchants Merger

April 18, 2012 /

The Office of Fair Trading will no longer knock the doors of the Competition Commission as it accepted undertakings offered by the Saint-Gobain group (the owners of Jewson) to address the competition concerns arising from its completed acquisition of Build Center.

The transaction initially qualified for review by the European Commission but it was referred to the OFT by virtue of the Article 4(4) procedure under the European Merger Regulation because the OFT was considered to be the best placed competition authority to review it. This procedure enabled the OFT to analyse local issues as part of its assessment.

The undertakings require Jewson to sell 23 builder’s merchant stores in 22 local areas to resolve the competition concerns identified by the OFT during its investigation into the merger.

Under the terms of the undertakings, the OFT must approve purchasers before they can buy any of the stores. The OFT will carefully assess the suitability of purchasers in each local area to ensure that they are capable of providing sufficient competition to the merged Jewson and Build Center business and other builders merchants in the area.

Ali Nikpay, Senior Director at the OFT and Decision Maker in this case, said: “The OFT was concerned that builders and other tradesmen would see an increase in prices for building materials as a result of this merger in a number of local areas. We are satisfied that the divestments offered by Jewson will remedy these concerns and restore pre-merger competition.”

 

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