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OFT accepts undertakings from Greene King

164/04     6 October 2004

The OFT has today accepted undertakings from Greene King Plc to sell-off 13 pubs in seven petty sessional divisions (PSDs).

On 9 August 2004 the OFT announced that Greene King's acquisition of Laurel Pub Holdings Ltd would not be referred to the Competition Commission if Greene King gave suitable undertakings to remedy competition concerns (see press release 123/04).

The OFT considered that it may be the case that the merger may be expected to result in a substantial lessening of competition in the operation of pubs in seven PSDs.  The OFT was concerned that the acquisition by Greene King of a number of pubs in these areas may give rise to less competition at a local level to offer customers value for money.

Greene King has signed undertakings to divest 13 pubs in seven PSDs to a buyer or buyers to be approved by the OFT.

Penny Boys, Executive Director of the OFT, said:

'These undertakings to sell 13 pubs will address the competition concerns we identified in the seven local areas.  The existence of a clear cut remedy has avoided the need to refer this case to the Competition Commission.'

NOTES

1. The Enterprise Act 2002 empowers the OFT to refer to the CC a completed or anticipated merger for investigation and report where such merger creates or enhances a 25 per cent share of supply in the UK (or a substantial part thereof) or where the UK turnover associated with the enterprise being acquired is over £70m, and where the OFT believes that it is or may be the case that the merger has resulted, or may be expected to result, in a substantial lessening of competition within any market or markets in the UK.

2. The OFT may, instead of making a reference to the Competition Commission, accept undertakings from an appropriate party to take such action as it considers appropriate to remedy, mitigate or prevent the substantial lessening of competition or any adverse effect which has or may have resulted from it (or may be expected to result from it).

3. On 27 August 2004 the OFT invited interested parties to comment on the proposed undertakings. Following the expiry of the consultation period, the OFT has decided to accept the undertakings in the form in which they were consulted on.

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