OFT to review Toolstation deal
Travis Perkins' £24m acquisition of 70 per cent of Toolstation is to be reviewed by the Office of Fair Trading (OFT).
Northampton-based Travis Perkins, which now owns all 103 Toolstation outlets, bought an initial 30 per cent interest in the building products retailer in April 2008, when it comprised 12 stores. It wants to complete the buyout of the remaining 70 per cent.
"While Travis Perkins will cooperate fully with any review, the company sees absolutely no basis for this notification and will be seeking clarification from the OFT at the earliest opportunity," the builders' merchant told the Stock Exchange.
Having paid £18m for its first share, the company completed the buyout for a total £42m.
The UK government agency can look at a merger before the closure of a deal or up to four months after completion.
The OFT inquiry will examine if the deal qualifies as a "relevant merger situation" under the Enterprise Act 2002; and assess whether there is a realistic chance the merger will substantially lessen competition.
A relevant merger situation is created if either the value of the turnover of the target company is more than £70m or if a 25 per cent share of supply is created or enhanced.
