LONDON (Alliance News) - The UK Competition & Markets Authority on Tuesday said interdealer broker ICAP PLC's sale of its voice-hybrid broking and information businesses to rival Tullett Prebon PLC will face an in-depth investigation, but focused only on oil products broking.
The CMA said after considering the 20 overlapping product categories involved in the deal, the regulator believes all but one of these will result no realistic prospect of a substantial lessening of competition as a result of the deal.
However, the CMA said the merger does give rise to the prospect of a lessening of competition for the voice-hybrid broking of oil products, where competition from other brokers is more limited. There is also a lesser constraint on this market from electronic platforms and exchanges.
The CMA said it has received a number of third-party concerns about this portion of the merger.
As a result, the deal will be referred for an in-depth phase two investigation by an independent group of CMA panel members unless the pair offer remedies to address the concerns.
Both companies published statements on the CMA announcement on Tuesday morning. Tullett said it "intends to explore how best to satisfy the CMA's concerns" and said it still believes the deal is on track to close in 2016.
ICAP, meanwhile, said it is confident the deal will be cleared by the CMA and also expressed confidence the deal remains on track.
By Sam Unsted; samunsted@alliancenews.com; @SamUAtAlliance
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