CMA investigates water firms’ merger

The merger of Bournemouth Water with South West Water has been referred for an in-depth investigation. The Competition and Markets Authority (CMA) refers mergers involving water companies for phase two […]

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By Priyanka Shrestha

The merger of Bournemouth Water with South West Water has been referred for an in-depth investigation.

The Competition and Markets Authority (CMA) refers mergers involving water companies for phase two investigation if it believes they have a UK turnover of more than £10 million.

Although the Water Act 2014 will remove the mandatory referral of water company mergers for the second phase, the rules are not in place yet.

The CMA will investigate whether the merger has or could prejudice the ability of regulator Ofwat to make comparisons between different water companies in areas such as price regulation.

South West Water owner Pennon bought Bournemouth Water from Sembcorp Holdings in April 2015 for £100.3 million.