The CMA has provisionally found that YPO’s anticipated
purchase of close competitor Findel could leave schools worse
off.
Yorkshire Purchasing Organisation (YPO) and Findel Education
Limited (Findel) are 2 of the leading suppliers of educational
resources in the UK supplying stationery, furniture, and art and
science materials to educational institutions, such as schools
and nurseries. YPO announced its planned £50 million purchase of
Findel last year.
During its in-depth Phase 2 investigation, the Competition and
Markets Authority (CMA) has looked at the impact of the merger on
schools and nurseries. It has provisionally found that both
companies compete closely, and any merger would reduce
competition resulting in increased prices or reductions in
service levels, quality and the range of products offered by the
merged company.
The CMA looked at a number of suppliers within the educational
supplies sector to understand the main sources of competition to
YPO and Findel. If the merger were to take place, the primary
competitor to the merged entity would be RM Plc, a generalist
UK-wide supplier, with more limited competition from a small
number of regional generalist suppliers. The CMA provisionally
found that competition from smaller, specialist and online-only
suppliers is more limited. As a result, the merger would leave
educational institutions worse off with few alternative close
competitors to the merged company.
In reaching its provisional decision, the CMA analysed a wide
range of evidence looking at how closely these firms compete,
including internal documents of the companies and their
competitors. It also engaged with customers, competitors, and
other stakeholders to inform its findings.
Stuart McIntosh, Inquiry Group Chair, said:
“These firms are 2 of the leading suppliers of educational
resources in the UK, so it’s important that the CMA protects
schools and nurseries who rely on their products. The loss of
competition as a result of this merger would likely lead to
either higher prices or reduced service, and less choice for
schools, which are already under considerable financial
pressure.”
All interested parties now have until 30 October 2020 to submit
views on possible remedies to address the CMA’s concerns, which
may include blocking the deal. All interested parties also have
until 6 November 2020 to submit views on the CMA’s provisional
findings.
For more information, visit the Yorkshire Purchasing
Organisation/Findel Education merger inquiry web page.
