MFG has offered to sell the Murco petrol station in Hythe in a bid to avoid a full merger investigation by the Competition and Markets Authority (CMA) into its acquisition of Murco’s retail business.
Last month the CMA said the acquisition might be expected to result in a substantial lessening of competition in the retail supply of road fuels in the Hythe area in Kent.
The Murco deal means MFG owns both the filling station in Hythe and the CMA said it was concerned whether there would be sufficient competition from other petrol stations in the area to prevent higher prices or service levels being compromised.
However, it added that MFG could avoid the acquisition being referred for an in-depth phase 2 merger investigation if it could offer an acceptable solution to address the competition concerns.
After the initial announcement MFG managing director Jeremy Clarke commented: “We are delighted that the CMA has only found one location, Hythe in Kent, where it believes there are competition concerns with MFG now operating two stations that are situated close to each other.
“MFG is keen to remedy the competition concerns in a clear-cut way and to avoid an in-depth CMA investigation. We will, therefore, be working with the CMA to arrive at a quick and acceptable solution.”
MFG has proposed an undertaking to the CMA to divest the Murco petrol station site in Hythe. The CMA has responded that “there are reasonable grounds for believing that the undertaking offered by MFG, or a modified version of it, might be accepted”.
The CMA now has until 5 March to consider whether to accept the undertaking, or a modified version of it, although it can extend the deadline to 5 May if it considers there are special reasons for doing so.
As part of the consideration process, the CMA will undertake a public consultation on whether the proposed undertaking is sufficient to address the competition concerns.
MFG acquired 228 Murco branded petrol stations and 226 fuel supply contracts for independent dealers from Murco in October. Pre-acquisition, MFG owned and operated 60 petrol stations in the UK under the BP, Jet, and Total brands.