The Market And Me

There are a number of CMA market investigations going on at the moment.

These raise many challenges for participating companies. But there’s one that I have found regularly crops up……

It’s all about finding and maintaining the right scope of thinking and analysis.

It’s natural for executives in participating companies to focus on their own organisation.

And correspondingly easy to forget that the investigation is into the market .

The two are clearly related. But they are far from the same.

Commenting on the market can be very different from focusing narrowly on your company’s own position.

Previous cases show that it’s very easy to lose sight of the distinction. And to keep up the concentration needed to maintain it.

To take just one example: It is easy to miss the opportunity to contribute to the CMA’s thinking about remedies to deal with competition failures in the market if you focus on the view that remedies are not relevant to your own situation.

If you are involved in a CMA market investigation big questions to make sure you address early on are therefore:

  • What precisely is our organisation’s role in the market?
  • How similar or different is it from other participants?
  • How best to describe our organisation’s position and role?
  • What opportunities and threats are there from the CMA’s focus on the market (rather than just on our own contribution)?

This Friday only – April 14th – I am giving free briefings for clients and subscribers to my blog on ‘How Best To Navigate A CMA Market Investigation’. Please email me to arrange a time.

The CMA Will Definitely Clear This Merger

An investor tells me with certainty that, if the high profile deal in which he is interested happens, the CMA will definitely clear it.

“They (the acquirer) wouldn’t go ahead if they weren’t absolutely sure they could get it through”, he insists.

It’s a view that I’ve heard many times during my investor briefings on mergers from supermarkets to video games.

It’s a bold claim.

Which is why – when it crops up – I usually find myself asking briefing participants the following:

What would have to be the case for it to be true?

What would have to be true for this to be the case?

At which point participants to the discussion tend quickly to alight on three big assumptions:

1. That the acquirer has prepared perfectly for all eventualities

2. That none of the eventualities results in any risk whatsoever that the CMA will find competition problems.

3. That this acquirer would only proceed with absolute certainty of outcome.

When that happens discussion often then turns to how frequently these assumptions have held in similar past cases.

Quite a lot is known about that, under all three headings.

And when that is discussed, guess what tends to happen next.