LONDON (dpa-AFX) - The UK's Competition and Markets Authority or CMA, which has been investigating Thermo Fisher Scientific Inc.'s (TMO) $925 million takeover of Roper Technologies Inc.'s (ROP) Gatan business, said Wednesday that the acquisition raises concerns that customers using specialist microscopes could face higher prices or lower quality products.
Thermo Fisher manufactures, among other things, high-tech electron microscopes used for scientific research, while Gatan produces highly-specialised 'peripherals' or add-ons, such as filters, cameras and detectors, which enhance the performance of microscopes for customers such as UK universities.
The CMA said that after completing its Phase 1 investigation, it has concerns that the deal could adversely affect Thermo Fisher's two rivals in the sector, who use Gatan peripherals with their electron microscopes.
'For some products, including certain filters and cameras, there are either no - or extremely limited - alternatives to Gatan available,' the CMA said.
The CMA added that it is concerned the proposed deal could allow Thermo Fisher to weaken its competitors, enhancing its own already strong market position, and lead to higher prices for customers using electron microscopes.
Additionally, the CMA's investigation has raised concerns that the merger will leave Thermo Fisher with insufficient competition in the market for direct detection cameras, as Gatan is currently one of only two competitors in the supply of these instruments.
In addition to potentially resulting in higher prices for customers across the sector, the CMA has concerns that less competition would reduce the incentive for further product development.
The CMA noted that if the merging businesses are unable to address its concerns, the merger will be referred for an in-depth Phase 2 investigation, to be carried out by a group of independent CMA panel members.
Copyright RTT News/dpa-AFX