Anticipated acquisition by Speedy Hire plc of the tool hire division of Hewden Stuart plc

Affected market: Tool and equipment hire

No. ME/3082/07

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

The OFT's decision on reference under section 33(1) given on 25 July 2007. Full text of decision published 1 August 2007.

Please note that square brackets indicate figures or text which have been deleted or replaced with a range at the request of the parties for reasons of commercial confidentiality.

PARTIES

Speedy Hire plc ('Speedy Hire') is a tool and equipment hire company listed on the London Stock Exchange.

Hewden Hire Centres is the tool hire business of Hewden Stuart plc, a UK tool and plant hire company, which is itself an indirect subsidiary of Finning International Inc. Hewden Hire Centres' turnover in the UK in the most recent financial year was £89.8 million.

TRANSACTION

The parties announced on 14 June 2007 an agreement under which Speedy Hire will acquire the assets of Hewden Hire Centres for £115 million.

The Office of Fair Trading's (OFT) statutory deadline for deciding whether to refer the merger to the Competition Commission is 26 July 2007.

JURISDICTION

As a result of this transaction Speedy Hire and Hewden Hire Centres will cease to be distinct. The UK turnover of Hewden Hire Centres exceeds £70 million, so the turnover test in section 23(1)(b) of the Enterprise Act 2002 (the Act) is satisfied. 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.

THIRD PARTY VIEWS

The OFT received comments from a number of competitors and customers, none of which raised any substantive competition concerns in relation to the merger. In fact, most commentators explicitly agreed that there remains sufficient competition at both national and local levels to meet the requirements of the full range of customer types.

ASSESSMENT

Although the parties are both national players, their combined shares of supply are not such as to give rise to competition concerns. There are sufficient national and local players to provide competitive constraints on the merged entity both for national contracts and for local tool and equipment hire needs. Third parties were unconcerned about the merger.

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

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

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