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Competition watchdog flags concerns on proposed merger
THE Competition Commission of Singapore (CCS) has raised concerns about the proposed acquisition of Drew Marine's technical solutions, fire, safety and rescue businesses (DTMS) by Wilhelmsen Maritime Services AS (WMS).
Having completed the first phase of its review, the CCS noted that the two companies overlap in the supply of marine chemicals, marine gases and marine welding equipment.
The CCS said in a press release issued on Monday that it has raised competition concerns with WMS that the proposed transaction could lead to price increases, deterioration in the quality of products and/or service levels.
"In particular, the parties are two of the largest players that possess extensive global networks of end-to-end distribution and ancillary services for the provision of chemicals, gases and equipment to the marine sector, and appear to be each other's closest competitors," the CCS said.
"Alternative suppliers may face difficulty achieving sufficient geographic scale to be viable alternative sources of supply and to exert sufficient competitive pressure on the merged entity post-merger, especially for customers that procure on a global basis."
The companies are able to offer commitments to address the potential competition concerns that may arise or the merger will proceed to a detailed phase two review upon the CCS receiving the relevant documents from WMS.