Details of a deal, which may head off an investigation into the merger of two major petrol pump suppliers, have been disclosed by the Competition and Markets Authority (CMA).
In June Dover Corporation agreed to buy Wayne Fueling Systems for $780m, but the CMA said it has found that the merger may lead to competition concerns in the supply of fuel dispensers in the UK.
It said “other than Dover and Wayne, there is only one other significant supplier of fuel dispensers in the UK (Gilbarco), with other suppliers lacking sufficient scale to constrain the merged entity. The investigation also found significant barriers to manufacturers seeking to enter or expand their UK presence.”
However, it said it would not carry out a full-scale investigation of the deal if undertakings were given that would allay the competition fears.
The companies suggested two alternative proposals:
either: i) Dover would release Tokheim SSD from its obligation to only distribute Dover’s fuel dispensers in the UK, and Dover would also take measures to support Tokheim SSD distributing a rival manufacturer’s fuel dispensers in the UK;
or ii) Wayne would sell its UK distribution business to a buyer, to be approved by the CMA.
The CMA is proposing to accept the proposal to sell Wayne’s UK distribution business. Dover and Wayne have proposed Eurotank Service Group or Petrotec as buyers. The CMA said it believed that the remedy, and these proposed buyers, will resolve its competition concerns in a clear-cut manner, subject to any feedback it receives during consultation.
The CMA is inviting written comments from interested parties. Anyone wishing to respond to the consultation should do so in writing, by no later than 5pm on 14 December 2016, to:
Competition and Markets Authority
Tel: 020 3738 6843