CMA to investigate proposed merger of major property firms – London Wallet

The Competition and Markets Authority (CMA) has opened an investigation into the Barratt acquisition of Redrow, believed to be worth in the region of £2.5bn.

Barratt announced in early February that it had agreed a deal to buy Redrow, a surprise move that would make the firm the largest housebuilder in the UK.

The proposed deal would see Barratt take 67.2% of the group and Redrow shareholders retaining 32.8%.

Both companies are already the subject of another CMA competition probe after evidence emerged that some housebuilders may be sharing commercially sensitive information with their competitors, which could be influencing the build-out of sites and the prices of new homes.

The CMA said that the move “may be expected to result in a substantial lessening of competition within any market or markets in the United Kingdom for goods or services”.

The watchdog added: “The CMA is issuing this preliminary ‘invitation to comment’ to allow interested parties to submit to the CMA any initial views on the impact that the transaction could have on competition in the UK. This invitation to comment is the first part of the CMA’s information-gathering process, in advance of the CMA’s formal investigation starting.”

The deadline for responses is 2 April. The CMA’s full timetable for its enquiry has yet to be confirmed.