Deal cleared for takeover

The Competition and Markets Authority (CMA) has today cleared Menzies Aviation’s takeover of part of Airline Services’ business after an in-depth investigation allayed competition concerns.

Both firms supply airlines in the UK with support services including the de-icing of aircraft and ground handling. The merger was announced last April.

Airline Services, a subsidiary of Airline Services and Components Group, has an annual turnover of £34.9m and provides de-icing and aircraft presentation services to more than 60 airlines at 12 UK airports, together with ground handling operations at London Gatwick.

An initial probe raised concerns that the merger could result in less choice and higher prices or a reduction in quality for these services for airlines at a number of key airports in England and Scotland.

These concerns led to the merger being referred to an in-depth investigation.

The CMA has today issued its final decision. It said: “Having thoroughly scrutinised the wider evidence base considered in the Phase 2 inquiry, it has found that the market for ground handling services has a strong recent history of companies entering and competing for contracts.

“The CMA also found that Menzies and Airline Services are not close competitors in the market for de-icing services, meaning the takeover would not lead to a substantial lessening of competition.

“The CMA has therefore decided to clear the merger.”