About Adrian Payne Consulting

Specialist in merger analysis

One Of The Above

Here’s a question that’s worth asking if you’re assessing the prospects for the outcome of a CMA merger investigation:

In recent years which minority type of merger accounted for 100% – yes, 100% – of the marked rise in CMA Phase 1 references to an in-depth Phase 2 investigation?

Was it…

  1. Cases that the CMA selected for investigation (as opposed to cases notified by the parties)?
  2. Cases involving a so-called non-horizontal theory of harm?
  3. Cases that attracted complaints from customers and competitors?
  4. Cases launched by the CMA in the second quarter of the year?
  5. Cases that are anticipated (rather than completed) and that were qualified for investigation under the turnover test?
  6. Cases that involved so-called ‘platform’ businesses?
  7. Cases involving concerns about potential competition (as opposed to the removal of existing competition)?

Which answer would you choose? (Do drop me a line or put your answer in the comments box below)

If there’s sufficient interest I’ll look at the main candidates in future posts.

And, no, it’s not a trick question!

One of the above is the correct answer!….

…..Which in turn means revisiting the simple ‘rising CMA intervention’ narrative that often appears in commentaries.

Dial or No Dial?

I’ve been very struck over the years by how differently companies prepare for CMA hearings during merger investigations.

Hearings are an important feature in many merger investigations, providing an opportunity for the merging firms, rivals and other interested parties to make their case.

Some hearings are turning points in a case.

Some are wasted opportunities.

Much depends on how hard the organisations involved think (or don’t think) about the objectives they set themselves.

Some prepare to dial up the rhetoric.

Some prepare to move the dial.

So, for all those with CMA hearings in view here’s a key question to start with…..

What are you really preparing for ?

UK Merger Insights 2023 No. 2

Here’s a selection of some of recent articles and speeches relevant to UK merger control……………..

1. Mark-ups

Here Ian Small examines what mark-ups tell us about competition and merger control in Europe.

2. Cerelia/Jus-Rol

Christopher Hutton and colleagues take a look at the Cerelia/Jus-Rol decision – link here.

For more on why this case wasn’t as unusual as it might seem, see this post from my blog.

3. Tougher Merger Control Ahead?

In this article Ninette Dodoo and colleagues envisage tougher merger control worldwide. Which points apply to the UK?

4. Too Interventionist?

CMA Chief Executive Sarah Cardell rebuts criticisms of the CMA’s approach to merger control in this speech. I’ll be looking at some of the points she discusses in forthcoming blog posts

5. The Power Of Competition

In this speech, new CMA Chairman, Marcus Bokkerink, draws on his 30 years’ business experience to reflect on what competition means and the role of the CMA.

Click here if you would like to see my previous selection of articles

Twenty Two Too

Fully understanding the prospects for a UK merger control investigation – whether as an investor, a merging firm, or a merging firm’s rival – depends on how well you interpret the CMA’s stance towards mergers and over what period.

I find that the best-prepared look at the CMA’s track record in merger assessments over both the short- and the longer-term, in order to help evaluate what has changed and what is changing.

And they also recognise that developments in the UK can differ from the more global narratives that tend to dominate a lot of merger control commentary.

This is especially important for investors and companies from outside the UK.

With all that in mind, here’s a quick synopsis of key UK themes from my series of posts looking back at 2022 and putting it in the context of what came before:

Which of these themes is most relevant to your merger in 2023?

Phase 2 In 2022

In my previous posts reviewing 2022 I have focused on Phase 1 outcomes.

To complete the picture here are the key figures regarding the CMA’s completed Phase 2 merger investigations in 2022…………………..

The Most To Date…

In 2022 there were 14 final decisions, the highest under the CMA and well above the previous years’ average of 10.

But for some of the merging companies involved there was good news……

Good News?…

First, the deal survival rate (8 out of 14) was the highest since 2017, the last time that survivors outnumbered terminated deals.

Second, the number of Phase 2 remedies accepted (5) was the highest number since 2016.

As I noted in my review of Phase 1 outcomes, remedies at that phase were also at their highest since 2017, a theme I’ll return to in a forthcoming post.

And third, the five Phase 2 remedies included two of the new ‘fast-track’ Phase 2 remedies that are now potentially available to merging parties – Sika/MBCC and Carpenter/Recticel.

Quick Fix Questions…

It will be interesting to see how this new policy works in practice.

Here are two questions about it worth keeping in mind….

1.How will this new fast-track process affect the incentives of the parties to offer undertakings at Phase 1 and overall case strategy at Phase 2?

2. And how might it affect the substantive competition assessment at Phase 2 and thereby change the overall enforcement pattern at Phase 2?

If you have thoughts on this, do feel free to comment.

Click here for an interesting piece on Phase 2 fast-track cases by Sofia Platzer and colleagues

According To Our ForFarmers

The CMA’s write-up of its Phase 1 decision regarding the joint venture between Forfarmers and Boparan raises several important points relevant to parties assessing merger control prospects, including :

  1. It cannot be assumed that the CMA will use the same travel distances for catchment areas as in previous cases that the parties think are similar
  2. Local share of supply thresholds can form the SLC decision rule (rather than a trigger for further analysis) – even in cases where the number of local areas for consideration is small
  3. The level of the share of supply thresholds used to determine SLC (in this case 35% + 5%) depends on the facts of the case – for example, whether rivals have spare capacity.

The CMA identified horizontal and vertical competition concerns.

The deal has been abandoned shortly after reference to a Phase 2 investigation.

An Unusual Call Of Duty?

Last week the CMA announced that it has provisionally found so-called ‘vertical’ competition problems with the Microsoft/Activision deal, centring on the popular game ‘Call of Duty’.

A vertical problem is one that results from of the coming together – or greater coming together – of different levels in a supply chain, rather than a combination at the same level.

In the past few days there has been a lot of commentary on last week’s announcement, some of it suggesting that this case is somehow unique or unusual.

So – How unusual is this outcome?

As always, it depends how you measure it. But here are a couple of thoughts………


This case is one of 14 where the Phase 1 investigation identified vertical competition problems sufficient to justify reference to an in-depth Phase 2 investigation.

To put this is context, there have been around 90 completed CMA Phase 2 investigations to date.

Five of the previous thirteen survived the CMA process.

This is a very similar survival rate to other Phase 2 cases


In my assessment, the Microsoft/Activision CMA Phase 2 investigation is one of eight to focus primarily or exclusively on vertical matters.

If the CMA decided to prohibit the current transaction it would mean that three of the eight did not survive the CMA process.

If, instead, the CMA accepted a remedy to the competition problems identified, this would the first among these eight cases.


There may well be other ways of looking at the question of how distinctive this case is.

Do comment below or drop me a line if you have other perspectives.

This post builds on data from a briefing on this case held in the first week of the year which also looked at the detail of the Phase 2 process and the significance of the extension to the Phase 2 timetable.

UK Merger Insights: 2023 No.1

Here are links to some of the most insightful merger control articles I’ve come across so far this year:


In this article Scott Sher discusses a number of matters that are highly pertinent in the UK as well as in the US, the focus of the piece.


Will pressure on disposable incomes affect the CMA’s priorities in terms of which mergers it looks at?

James Baker and colleagues look at this question here.


What can we learn from the two fast-track CMA Phase 2 remedy cases to date?

Sofia Platzer and colleagues take a look here.


The future of merger remedies.

In this piece John Davies reports on the main themes of a recent conference on the subject


The first year of the National Security and Investment Act

Kate Kelliher and Marc Israel review what happened in 2022. Link here.

Please feel free to add a comment or press the ‘like’ button if you’d like more of these occasional round-ups.

Late Exit Pass

The CMA’s recently-published Phase 1 decision on the Korean Air Lines/Asiana Airlines merger includes interesting discussion on the way in which arguments unfolded as to whether that the target would exit if the merger did not proceed.

The merging parties’ initial submission was that, in the absence of the merger, Asiana would be a substantially weaker competitor.

According to the decision write-up the parties only later argued that the criteria for the ‘exiting firm’ test are met, an argument that the CMA rejected.

In the parties’ response to the CMA’s issues letter, they indicated that they had not made this argument earlier because the CMA had indicated that it would be highly unlikely to accept such a counterfactual in Phase 1.

The CMA said that the fact that the Parties only submitted that the exiting firm test is met at a very advanced stage of the CMA’s investigation (ie in response to the issues letter) limited the CMA’s ability to conduct the evidence-gathering that would typically be required to assess whether this test is met.

This is all rather circular!

But it isn’t new.

Late and unsuccessful deployment of an exiting firm case at Phase 1 has been seen many times before.

In fact I talked about it in my very first blog – nearly ten years ago!

In a later post I’ll aim to look at some of the reasons why this scenario recurs.

In the meantime, here’s the key question that firms contemplating merger in the UK might want to ask very early on:

What can be learnt from the 48 previous CMA cases in which ‘exiting firm’ arguments have been deployed about :

prospects for success and

how best to make the argument?

The Great Bake … Off


On January 20th the CMA announced its first merger prohibition of the new year by concluding that merger between Cérélia andJus-Rol is likely to reduce competition substantially and that Jus-Rol needs to be sold to an independent buyer.

It is unusual to see a case in the food manufacturing sector referred to a Phase 2 inquiry. In fact it’s only the second time for the CMA, out of 29 cases to date.

And this is the first to be prohibited.

According to the CMA, Jus-Rol is by far the largest supplier of branded ready-to-bake products in the UK, while Cérélia is the largest supplier of own-label ready-to-bake products, making these items on behalf of some of the nation’s largest grocery retailers.

Key to the CMA’s Phase 2 conclusion were the following findings:

  • the merger brings together the 2 leading suppliers in the market by a considerable margin – ready-to-bake items supplied by Cérélia and Jus-Rol account for nearly two-thirds of all such products sold to grocery retailers in the UK.
  • Jus-Rol items compete with supermarkets’ own-label products supplied by Cérélia for the same space on many supermarket shelves.
  • grocery customers regard the companies’ products to be important alternatives to one another – particularly because there are few credible alternative suppliers of either branded or own-label products.
  • the merging businesses face limited competition, with all other suppliers being far smaller and many of them lacking the capabilities held by Cérélia and Jus-Rol.

So is this food sector prohibition as unusual as it might seem?

Not if you look more widely than this particular sector.

According to my analysis there have been 10 previous deals with the same pattern of key evidence, across all sectors. Only two have raised no significant competition problems and none have so far survived the Phase 2 process.

The link to the CMA’s Phase 2 report is here.