The Competitions and Markets Authority has officially given the green light to American Express GBT to buy CWT.
In a statement today, the CMA said it has concluded that “CWT is a significantly weaker competitor than in the past and is likely to continue to weaken in the future and that there are other suppliers who will offer customers an alternative to the merged business”.
Therefore, it is satisfied the merger is not expected to result in “a substantial lessening of competition in the global market for the supply of business travel agency services and has cleared the deal”.
Martin Coleman, chair of the independent panel of experts conducting the investigation, said: “Having reviewed all the evidence thoroughly over the course of our investigation we have concluded, given the weaker position CWT plays in the corporate travel market and the alternatives available, that this deal should be allowed to proceed.”
In November, the CMA’s interim report provisionally found the proposed merger between GBT and CWT was likely to substantially lessen competition, but the CMA made a U-turn in February.
“We are pleased with the CMA decision,” said Amex GBT CEO Paul Abbott. “By combining with CWT, we can provide even more value and choice to customers and suppliers and more opportunities for CWT employees.”
But the deal still needs approval from US competition regulators. In January, the United States Department of Justice filed a civil antitrust lawsuit seeking to block the merger. The case is currently before the US courts.
Eric J. Bock, Amex GBT’s Chief Legal Officer and Global Head of M&A added: “The CMA decision also further reinforces our belief that the lawsuit initiated by the U.S. Department of Justice (DOJ) is fundamentally flawed, taking a narrow and outdated view of competition, and disregarding the emergence of numerous significant competitors in business travel.
“We stand by the benefits of combining with CWT and are confident in the merits of our legal position. We are prepared to prove this in court if required.”
