Anticipated acquisition by Argenta Private Capital Limited of the Business and certain assets of Anton Private Capital Limited and the entire issued share capital of Anton General Partner Limited and SLP (Management) Limited

Affected market: Members' agency services to Lloyd's members

No. ME/1399/04

Please note that the full text of the decision can be downloaded using the link on the right . What follows are extracts regarding the parties, the transaction, jurisdiction, assessment and decision.

The OFT's decision on reference under section 33 (1) given on 23 December 2004

Please note that square brackets indicate information excised, or exact figures replaced by a range, at the parties' request.

PARTIES

Argenta Private Capital Limited (Argenta) is wholly owned by Argenta Holdings plc.  It is the third largest registered members' agent at Lloyd's of London insurance market (Lloyd's).  Argenta Holdings plc operates a managing agent, which is responsible for managing syndicate 2121 at Lloyd's.  Argenta's UK turnover for the financial year to 31 December 2003 was approximately £ [ ].
 
Anton Private Capital Limited (Anton) is the smallest registered members' agent at Lloyd's.  It is a wholly owned subsidiary of Anton Holdings Limited, which wholly owns Anton General Partner Limited (AGP) and SLP (Management) Limited (SLPM), both of which are involved in the management and administration of various Scottish Limited Partnerships (SLPs), which are members at Lloyd's.  AGP and SLPM are also part of the transaction.  Anton and SLPM's UK turnover for the financial year to 31 December 2003 was approximately £ [ ] and £150,000 respectively.  AGP did not generate any turnover during this period.
 
TRANSACTION

Argenta proposes to acquire the business and certain assets of Anton and the entire issued share capital in AGP and SLPM.  The proposed aggregate consideration payable is approximately £ [ ].

The parties notified the transaction on 15 November 2004 and the statutory deadline for consideration is 29 December 2004. 

JURISDICTION

As a result of this transaction, Argenta, Anton, AGP and SLPM will cease to be distinct.  Argenta and Anton overlap in the supply of members' agency services to Lloyd's members and the share of supply test in section 23 of the Enterprise Act 2002 (the Act) is met as the parties' combined share of the supply of members' agency services to Lloyd's members would exceed 25 per cent as a result of the merger.  The OFT therefore believes that it is or may be the case that arrangements are in progress or in contemplation which, if carried into effect, will result in the creation of a relevant merger situation.

ASSESSMENT
 
The parties overlap in the supply of members' agency services to Lloyd's members.  The transaction brings together the third largest and the smallest Lloyd's members' agents and reduces the number of agents from four to three.

The weight of the evidence in the OFT's investigation indicates that, on balance, the merger is not expected to raise competition concerns.  Post-merger, the parties will continue to be constrained by Lloyd's regulation which tightly controls the Lloyd's market.  The majority of customers were unconcerned, with many commenting that the merger would enhance competition, as it would enable Argenta to compete more effectively with the two other much larger members' agents in Lloyds by reducing costs and improving the quality of its services. 

Consequently, the OFT does not believe that it is or may be the case that the creation of this merger situation may be expected to result in a substantial lessening of competition within a market or markets in the United Kingdom for goods or services.

DECISION

This merger will therefore not be referred to the Competition Commission under section 33 (1) of the Act.

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