Antitrust Law Daily Wrap Up, ANTITRUST NEWS: Acquisition of aircraft de-icing business faces investigation by UK competition authority, (Feb 11, 2016)

By Michael Menzhuber, J.D., LL.M.

The proposed acquisition of Kilfrost’s aircraft de-/anti-icing fluids (ADF) business by Clariant will be referred for an in-depth phase 2 investigation unless Clariant offers undertakings that address competition concerns, the Competition and Markets Authority (CMA) announced on February 9.

The proposed acquisition would result in the merger of the two largest suppliers of ADF in the UK. Evidence gathered by the CMA shows that customers are concerned about the loss of competition and choice if the proposed acquisition is completed. The CMA also believes that there could be insufficient rivalry from other suppliers to offset this loss of competition and that expansion or new entry by other ADF suppliers is uncertain.

Consequently, the CMA found that the merger creates the real possibility of a substantial lessening of competition in the supply of ADF, which could lead to higher prices or a reduction in choice and quality nationally. The CMA also found that other factors important to customers, such as security of supply and innovation, could be negatively affected as a result of the merger.

Clariant has until February 16, 2016 to offer undertakings that might be accepted by the CMA. If no undertakings are offered and accepted, the CMA will refer the proposed transaction for an in-depth phase 2 investigation, which will be overseen by an independent group of CMA panel members.

News: Antitrust AcquisitionsMergers