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Airport services merger receives provisional clearance

Menzies’ purchase of Airline Services given provisional green light following in-depth CMA investigation.

The Competition and Markets Authority (CMA) has provisionally cleared Menzies Aviation’s takeover of part of Airline Services’ business after an in-depth investigation allayed competition concerns.

The 2 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 recently (14 December 2018) 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 has 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 currently inviting comments on its findings until 9 January 2019. It will then consider any submissions it receives before reaching a final decision, the deadline for which is 28 January 2019.

Further information can be found on our case page.

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Channel website: https://www.gov.uk/government/organisations/competition-and-markets-authority

Original article link: https://www.gov.uk/government/news/airport-services-merger-receives-provisional-clearance

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