The Competition and Markets Authority (CMA) has confirmed it will go to ‘phase 2’ in relation to the planned acquisition of CWT by American Express Global Business Travel.
The CMA warned last month that it was considering a more in-depth investigation due to concerns that the deal would lead to “worsened quality of service, higher prices and/or reduced innovation efforts for global multinational business travel customers, as a result of combining the current largest and third-largest company operating in this market”.
Mike Walker, Chief Economic Advisor at the CMA, said: “We’re concerned this deal between major suppliers of business travel agency services would reduce the pool of providers of these services to global multinational customers, which could lead to worse services and higher prices for global multinational customers.”
At that time, it gave Amex GBT until August 6 to address “the substantial lessening of competition” but the CMA confirmed today (August 12) that the TMC giant confirmed it would not offer such undertakings.
Eric J. Bock, Amex GBT’s Chief Legal Officer and Global Head of M&A, said: “We believe that a comprehensive Phase 2 analysis will demonstrate that the proposed transaction would result in many customer and supplier benefits, and that the business travel industry would remain highly competitive.
“In fact, as we’ve seen existing TMCs grow and new tech-led companies enter the industry in recent years, we believe competition will continue to intensify.”
The CMA’s decision following the phase 2 investigation is set for January 26 2025.
The deal was initially meant to be completed in the second half of this year but Amex GBT has pushed it back to the first quarter of 2025.
It has appointed Michelle Dyer as Transition Lead to oversee the acquisition of CWT.
As Vice President Transformation – CWT Acquisition Transition Lead, Dyer will steer strategy alignment and execution of the merger.
She has worked for Amex GBT for nearly a decade, with her most recent post being Vice President Global for SME Growth.
Amex GBT announced its intention to acquire CWT for $570 million in March 2024.
