20th Jul 2018 11:31
LONDON (Alliance News) - The UK Competition & Markets Authority has raised concerns about the proposed acquisition of ClearScore by FTSE 100-listed credit services firm Experian PLC, demanding they offer solutions to allay its worries or else it will initiate a more detailed probe.
In mid-March, Experian agreed to acquire fast-growing rival ClearScore for an initial GBP275 million in addition to a deferred earn-out dependent on future performance.
Its goal, Experian explained at the time, was to "provide more choice and greater convenience to individuals who want access to personal financial products at the best prices, while also making it easier for credit providers to offer better, more tailored offers to consumers."
In late May, however, the CMA began an investigation into potential competition concerns regarding the deal.
On Friday, the CMA noted the two firms were the "first and second-largest providers of free credit score checking in the UK." It also noted Experian was the largest paid credit score checking provider.
The regulator, therefore, explained: "As Experian and ClearScore are the market leaders in this field, and each other's main competitor, the Competition & Markets Authority is concerned the merged company would be less likely to innovate to help people better understand their finances, potentially leading to people paying more for credit cards and loans."
The CMA has provided Experian and Clearscore until next Friday to "offer solutions" to resolve its concerns. If they fail to do so, the deal will be referred to a more in-depth phase two investigation.
Shares in Experian were 0.7% lower at 1,919.00 pence on Friday, having risen 20% since the ClearScore deal was announced.
Related Shares:
Experian