The merger was referred for an in-depth investigation earlier this month
The UK’s Competition and
Markets Authority has detailed the reasons behind its decision
to refer the Intercontinental Exchange’s planned
acquisition of energy trading firm Trayport for a deeper probe,
highlighting concerns ICE could have too much pricing power and
squeeze out rivals.
The British authority said it has launched
a deeper probe into ICE’s $650 million acquisition of
Trayport from BGC Partners last year amid concerns over a
"substantially lessening" of competition, less than a month
after the investigation began.
"The Competition and Markets Authority
(CMA) … believes the merger gives rise to a realistic
prospect of a substantial lessening of competition… as a
result of vertical effects arising from the foreclosure of
exchanges, over-the-counter (OTC) brokers and clearing houses,"
said the CMA.
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