LONDON (dpa-AFX) - Competition and Markets Authority or CMA has expressed concern over Rentokil's (RTO.L, RTOKY.PK) takeover of the pest control unit of Mitie Group Plc. (MTO.L), following the opening of an investigation into the merger.
The U.K. regulators, in their phase 1 decision, have warned that the deal might restrict choice and lead to higher prices or reduced quality for customers. Therefore, Rentokil must now offer proposals to address concerns by April 23, or face an in-depth Phase 2 investigation into the merger.
Earlier in September 2018, Rentokil completed the takeover of Mitie's Pest Control unit. The firms are two of the leading suppliers of pest control services in the UK to commercial customers.
CMA also added having considered a broad range of evidence, it was found there could be a substantial reduction in competition, and it is unlikely that other companies would expand or enter the market in a timely manner and offset the loss of competition caused by the merger.
Copyright RTT News/dpa-AFX