UK competition regulator extends review period for Mastercard/VocaLink deal
The CMA needs extra time to review the remedies proposed by the two companies.
A follow-up to the story of the proposed purchase of VocaLink by Mastercard…
Further to FinanceFeeds’ report that the UK Competition and Markets Authority (CMA) would consider the remedies proposed by Mastercard UK Holdco Ltd, a subsidiary of Mastercard International Incorporated (Mastercard), and VocaLink Limited, with regards to the regulator’s competition concerns raised as a result of the proposed deal, the regulator announced today that it is extending the review period.
The watchdog is concerned that because VocaLink and Mastercard are two of the three most credible providers of infrastructure services to the LINK ATM network operating in the UK, the merger would reduce the number of bidders and will curb the ability of the LINK scheme to obtain good value when tendering for an infrastructure provider.
The previous announcement by the CMA stated that the review of the remedies proposed by MasterCard and VocaLink would last until March 15, 2017.
Today, however, the CMA said the review period will be extended until May 15, 2017. The reason – the regulator “ will require further time to consider responses to its consultation and make a decision”.
Amid the reasons for the change of decision timing is the need for negotiation of the relevant agreements between MasterCard, VocaLink Holdings Limited and Link Scheme Limited which the CMA sees as vital to securing an effective remedy. The regulator also notes “the complex nature of the proposed undertakings”. Somewhat cryptically, the CMA says there are “special reasons” for the extension.
The CMA, however, stresses that there has been positive progress and that it will seek to publish its decision as soon as reasonably practicable within the revised period. The watchdog also considers that the extension does not increase the risk of an anti-competitive outcome from the merger.