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CMA ‘concerned’ about Ecolab’s Holchem merger

CMA ‘concerned’ about Ecolab’s Holchem merger

The Competition and Markets Authority (CMA) has expressed concerns over the merger of two chemical companies based in the north west of England.

Back in December 2018, Cheshire-based Ecolab acquired Bury-based Holchem Group. Both firms are suppliers of cleaning chemicals to food and beverage manufacturers, and a CMA investigation into the merger provisionally found that the new company would face limited competition from others in the sector.

In fact, the investigation could create an organisation with a market share of anywhere from 40-50%, far greater than any of its remaining competitors according to the CMA. Access to competitively-priced, safe and effective cleaning chemicals and services is a vital part of ensuring food and drink are kept safe and free from contamination.

Kirstin Baker, the Inquiry Group Chair, said: “We are concerned that as a result of this merger, prices will go up or quality standards in crucial support services will get worse. The Group has therefore provisionally concluded that the merger is likely to lead to a substantial lessening of competition.”

The acquisition of Holchem Group by Ecolab was referred to the CMA in April for an in-depth investigation. The CMA has invited comments on both its findings (by 27 August) and its possible remedies (by 13 August), including possibly unwinding the deal.

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