The competition watchdog has raised further concerns over the merger of two northern based education businesses.
In December 2019, Accrington-based Studio Retail Group agreed a deal to sell its Findel Education business to public sector buying organisation YPO.
Findel Education, based in Hyde, is a supplier of resources and equipment to schools in the 海角视频 and overseas.
YPO, based in Wakefield, is a joint committee of 13 public sector founder member authorities established to aggregate demand and generate buying efficiencies.
The Competition and Markets Authority (CMA) launched an initial investigation into the £50m deal in April, with the regulator inviting comments.
After its initial Phase 1 investigation, the CMA found that both YPO and Findel compete closely with each other, and the deal will face further scrutiny.
The CMA said: “If the planned merger goes ahead, YPO would face effective competition from two other generalist distributors – RM Plc (which operates across the 海角视频) and ESPO (a large regional player) – and, to a lesser extent, KCS (a smaller regional player).
“The competition from smaller local generalist distributors, alternative specialist suppliers, high street retailers and online-only distributors, such as Amazon, would only be very limited.
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“The CMA therefore concluded that the merger may reduce competition both by eliminating Findel’s significant competitive constraint on YPO and potentially leading to market conditions in which some generalist distributors focus only on some regions of the 海角视频.
“As a result, the merger could leave educational institutions with fewer alternative suppliers and worse terms when purchasing educational supplies.”
This merger has now been referred for a Phase 2 investigation unless the parties "offer acceptable undertakings" within five working days to address the CMA’s competition concerns.