Builders merchant chain Jewson has offered to see a branch in 22 areas to ease competition concerns raised by its completed acquisition of rival builders merchant Build Center.
Jewson, part of French multinational Saint-Gobain, has 510 general builder’s merchants in the UK operating under the Jewson and ‘Gibbs and Dandy’ brands, against Build Center’s 149 branches, trading primarily under the Build Center brand.
The OFT concluded that the merger would not give rise to competition concerns nationally because sufficient competitors would remain in the market.
However, it did consider that the deal raised substantial competition concerns in 22 local areas in England, Wales and Scotland. This was because there were few remaining general builders merchants in these local areas and the OFT was concerned that builders and other tradesmen might see an increase in prices for building materials as a result.
In order to address these concerns, Jewson has offered undertakings to divest at least one branch in each of the 22 affected local areas to restore pre-merger competition levels.
Ali Nikpay, OFT Senior Director and the Decision Maker in this case, said:
While the undertakings are being considered, the OFT’s duty to refer the merger to the Competition Commission is suspended.