Polypipe pulls the plug on Verplas acquisition

Polypipe has abandoned its proposed acquisition of Verplas after an inquiry by the Office of Fair Trading (OFT) was referred to the Competition Commission (CC).

The OFT found that the merger would reduce the number of rigid ducting manufacturers in the UK from three to two and take Polypipe's market share over 50%. Its investigation concluded that the threat of greater imports or domestic entry was not sufficient to remove competition concerns.

The CC was asked to investigate further and decide whether the acquisition would result in a substantial lessening of competition in the UK rigid ducting market. It was expected to report its findings by late December.

However, the inquiry was formally cancelled last week after the CC received assurances from both parties that the proposed acquisition had been abandoned.