The Office of Fair Trading is considering whether the recent acquisition of Avelo by Iress will impact on competition in the sector.
The OFT has issued an “invitation to comment” and will carry out a “merger review” assess whether the deal will impact market competition.
In a statement, the OFT says: “The OFT is considering whether arrangements are in progress or in contemplation which, if carried into effect, will result in the creation of a relevant merger situation under the merger provisions of the Enterprise Act 2002 and, if so, whether the creation of that situation may be expected to result in a substantial lessening of competition within any market or markets in the United Kingdom.”
Written submissions raising competition concerns about the Iress/Avelo deal need to be submitted to the OFT by 3 December.
Iress, listed in Australia, issued a statement last night in which group general counsel Peter Ferguson said: “Evaluating the existence of a merger situation is a standard procedure for the OFT. It is not an indicator of itself as to whether there are any substantive competition concerns and IRESS maintains the view that the acquisition does not give rise to any such competition concerns.”
Evolve financial planning director Jason Whitcomb says: “There a number of barriers for new entrants. However, I’m a little surprised the OFT is looking at this as there are still a number of other back office systems available. Either way, it is important that there is competition in any market and the OFT is here to look at that.”