The UK Competition and Markets Authority (CMA) last week provisionally cleared Menzies Aviation’s takeover of part of Airline Services’ business after an in-depth investigation allayed competition concerns.
The two firms supply airlines in the UK with a variety of support services including the de-icing of aircraft and ground handling.
An initial Phase 1 probe raised concerns that the merger could restrict choice for airlines at a number of key airports in England and Scotland for both de-icing and ground handling, potentially leading to higher prices or a worse service. These concerns led to the merger being referred to a Group of independent CMA Panel members for an in-depth Phase 2 investigation.
The CMA issued its provisional findings based on a thorough evaluation of the wider evidence base in the Phase 2 inquiry. It has found that the market for ground handling services is particularly dynamic, with a strong recent history of companies entering the market to compete for contracts. With regard to de-icing services, the CMA found that competition between Menzies and Airline Services is very limited such that the merger would not lead to a substantial lessening of competition.
The CMA is inviting comments on its findings until January 9, 2019. It will then consider any submissions it receives before reaching a final decision, the deadline for which is January 28, 2019.
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