Sir Jim Ratcliffe, the chair of INEOS, the private chemicals giant, has accused Britain’s competition watchdog of being ‘increasingly hostile to business’, following its rejection of the firm’s $1bn acquisition of Sika AG, a concrete additives business.
Ratcliffe claims the Competition and Markets Authority (CMA) prevented the takeover without having any competing businesses and refused to meet face-to-face in the process. The rejection has seen Sika AG, which employed 1,600 people across the world producing concrete admixtures needed for the construction industry, purchased by a US firm instead.
Speaking out about the decision, Ratcliffe stated, “The latest snub led to Sir Jim Ratcliffe accusing the CMA of ‘building a reputation as an overly aggressive regulator with little regard for the impact of its decisions on UK business.'” He added, “He claimed ‘the CMA and UK government are becoming increasingly hostile to business.'”
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Responding to Ratcliffe’s remarks, a CMA spokesperson offered an explanation for the rejection: “Effective merger control is pro-business and pro-growth… When we conclude a deal can go ahead subject to part of a merged business being sold, we assess, among other criteria, whether potential buyers could lead to further competition problems. It is critical when approving a potential buyer that we don’t allow new competition problems to develop.”
The CMA also pointed to estimates which suggest that during the past 3 years, the CMA merger regime has saved consumers more than £2 billion.
It appears, then, that while Ratcliffe is criticizing the CMA’s decisions, they are only attempting to safeguard both businesses and consumers from the impact of larger mergers that may prevent competition.
