CMA raises concerns over Bottomline and EPG merger

The Competition and Markets Authority (CMA) has raised concerns over the completed merger of Bottomline Technologies and Experian Payments Gateway (EPG).

The regulator has been investigating whether the merger raises competition concerns and has now completed its Phase 1 investigation. It has now said that the merger may reduce product availability, reduce innovation investment and increase prices.

Both EPG and Bottomline provide payment software that is used by businesses to run payroll, pay suppliers and submit direct debits.

Both companies are leading providers of the software that connects the UK’s Bankers’ Automated Clearing Services (Bacs) scheme Bacstel-IP service and Faster Payments System Direct Corporate Access (FPS DCA).

The CMA state that if Bottomline had not concluded the deal with EPG, that there was a genuine chance that EPG may have been purchased by a different company, which could have created a more competitive market with more choice for customers.

Joel Bamford, Senior Director of Mergers at the CMA, said: “Payment software is critical to many businesses in the UK for managing payments including direct debits and paying their staff.

“Bottomline is already the largest supplier and has purchased a rival who is trusted by many large businesses with few remaining competitors left in the market.”

Bottomline has until 14 October to respond to the CMA’s concerns with solutions, otherwise, the regulator may begin a Phase 2 investigation.

Nigel Fry, General Practice Partner at Milsted Langdon, said: “The CMA has acted on this deal as it involves the largest supplier in the sector, and they have a genuine concern over the competition in the marketplace. It will now be a matter of whether Bottomline can ease the concerns of the regulator if they are to avoid a Phase 2 investigation.

“For advice on matters relating to mergers and acquisitions, contact our expert team today

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