Competition regulator says yes to City Energy’s proposed takeover of local LPG business
Megan Cheah
THE Competition and Consumer Commission of Singapore (CCCS) has greenlit City Energy’s proposed acquisition of Tan Soon Huah Gas Supply’s liquefied petroleum gas (LPG) business, following a public consultation on the issue.
The competition regulator said on Wednesday (Aug 2) that it has assessed the proposed deal and concluded that it would not infringe the Competition Act 2004, which prohibits mergers that could result in “a substantial lessening of competition within any market in Singapore”.
City Energy is the sole producer and retailer of town gas in Singapore. It is also the trustee of City Energy Trust, a wholly-owned subsidiary of Keppel Infrastructure Trust .
CCCS said it accepted a May 30 application from City Energy for a decision on whether its proposed acquisition would result in a “substantial lessening of competition”.
The commission conducted a public consultation from Jun 8 to Jul 21, seeking feedback from stake-holders such as competitors and customers of City Energy and Tan Soon Huah Gas Supply.
In its assessment of the proposal, CCCS found the transaction to be unlikely to lead to a substantial lessening of competition, as the companies involved are not each other’s closest competitors; there are other LPG gas companies in the market.
The acquisition, should it go through, would also not reduce the number of LPG gas retailers in the market. CCCS noted as well that City Energy is transparent with its prices and terms of supply to its customers.
“Furthermore, there are licence conditions imposed on City Energy’s town gas business that prevent it from unfairly using its town gas business to disadvantage its competitors supplying other fuel types,” added CCCS.
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