Nyhet: Norwegian TMC Berg-Hansen slams CMA U-turn on Amex GBT-CWT deal

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Denne teksten er hentet fra Business Travel News Europe. Du kan lese den originale artikkelen her: Norwegian TMC Berg-Hansen slams CMA's U-turn on Amex GBT-CWT merger.

Norwegian TMC Berg-Hansen has lambasted the change in position of the UK’s Competition and Markets Authority, which performed a U-turn last week by providing provisional approval for American Express Global Business Travel’s planned acquisition of CWT, having previously opposed the plans.

Berg-Hansen, which was ranked by BTN Europe as the fifth largest TMC in the Nordics region last year and is part of CWT’s Global Partners Network, said it was “very surprised” by the CMA’s new stance “and by the arguments used to arrive at a new provisional conclusion”. The CMA had previously opposed Amex GBT’s acquisition of CWT primarily due to the likelihood of a “substantial lessening of competition” for global multinational corporates.

In its response, Berg-Hansen said it found the CMA’s arguments used to arrive at a new conclusion “speculative and tendentious” and expressed concerns about the fate of CWT's partner network should the acquisition go through.

In particular, the TMC objected to the CMA’s view that CWT would emerge as a weaker competitor if the deal was blocked, claiming its assumptions around CWT’s financial position and the upward financial trajectory of smaller TMCs, including Navan and CTM, were unfounded.

“Past growth cannot predict future growth, and the future is particularly tricky to predict,” wrote Berg-Hansen. “The growth of smaller players will enhance competition, surely, but not necessarily reduce the competitiveness of CWT.”

“We can only hope that competition remains fierce among TMCs, but for the CMA to resort to speculative guesswork on Navan and CTM and claim it supports a conclusion of diminishing competitive strength of CWT is far-fetched at best.”

The CMA gave interested parties seven days to provide written responses to the publication of its supplementary interim report, with only those of Berg-Hansen and a joint statement from Amex GBT and CWT published yesterday. The Norwegian TMC complained that the short turnaround time made it “impossible” to review the latest report and prepare a thorough response.

The TMC’s statement added: “It is hardly surprising that an acquisition target is weakened by the limbo it finds itself in until the transaction is completed or blocked, as rumours and speculations arise about its future, whether among competitors or customers.

“It is ironic that regardless of the outcome of regulatory processes, GBT wins either by killing a direct competitor, or, at the very least, significantly weakening it.”

Critically for Berg-Hansen, it also expressed concerns that, if the transaction is allowed to go through, all current CWT partnership agreements would be terminated by Amex GBT, thus leaving the TMC without a partner in the Norwegian market.

“This would severely weaken the only credible competitor to the sum of GBT/HRG/Egencia/CWT in the Norwegian and many other markets, where the merged entity and Egencia will become dominant.”

Berg-Hansen also contends that CWT will have developed a ‘Plan B’ should the transaction fail, as should be expected of prudent shareholders, who will have to lend their support. “To use CMA’s own words: 'It is likely' that the owners possess the capacity and the will to strengthen CWT’s competitive position in that scenario.”

The TMC said the CMA “must revert to its previous conclusion and block the transaction”, adding “anything else would be disastrous for the TMC industry and its customers.”

In its own response to the supplementary interim report, Amex GBT and CWT welcomed the CWT’s provisional approval for the deal but maintained its assertions that the CMA’s market definition of GMN customers was too narrow, and argued that “at least six TMCs already compete strongly against the parties”.

“The parties do not consider the case to be ‘finely balanced’. Instead, the evidence demonstrates clearly that there will be no substantial lessening of competition as a result of the transaction,” it added.

*Teksten er opprinnelig publisert av Business Travel News Europe.