UK’s CMA Gives Provisional Approval to Amex GBT Acquisition of CWT
American Express Global Business Travel, which is operated by Global Business Travel Group (GBT), said Tuesday (Feb. 18) that updated provisional conclusions announced by the U.K.’s Competition and Markets Authority (CMA) support the company’s position as it defends itself against an antitrust case brought by the U.S. Department of Justice (DOJ).
The CMA said in a Tuesday press release that it provisionally considers that GBT’s proposed merger with corporate travel management company CWT Holdings should be allowed to proceed.
After saying in an earlier interim report on its merger inquiry published in November that the proposed merger was likely to lessen competition, the CMA said in a supplementary interim report published Tuesday that CWT is a weaker competitor than it has been in the past and that other suppliers can offer customers an alternative to the merged business.
“In this case, having considered all of the evidence in the round, particularly the further analysis of CWT’s financial position, we have now provisionally concluded that the merger will not result in a substantial lessening of competition in corporate travel management services,” Martin Coleman, chair of the independent panel of experts conducting the investigation, said in the release.
The CMA will now accept comments until Feb. 25 and then make a final decision on March 9, according to the release.
Noting the CMA’s announcement in a Tuesday press release, GBT Chief Legal Officer and Global Head of M&A Eric J. Bock said the updated provisional conclusions mark “an important milestone toward the consummation of the transaction.”
“The CMA’s revised findings reinforce the company’s belief that the DOJ’s lawsuit is fundamentally flawed, taking a narrow and outdated view of competition, and disregarding the emergence of numerous significant competitors in business travel,” Bock said.
The DOJ filed a lawsuit to prevent the merger in January, citing concerns over reduced competition in the travel management sector.
“If completed, this deal would extinguish fierce head-to-head competition between Amex GBT and CWT and risk higher prices, fewer choices and less innovation,” the DOJ said in its complaint.
When announcing its planned acquisition of CWT in March, Amex GBT said it would offer CWT’s 4,000 customers access to the Amex GBT ecosystem.
“Bringing CWT onto the proven Amex GBT software and services model will create more choice for customers, more opportunities for people and more value for shareholders,” Amex GBT CEO Phil Abbott said at the time in a press release.
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