UK watchdog to probe Arcelik-Whirlpool deal

(Sharecast News) - The UK competition watchdog is to launch an in-depth investigation into the proposed merger of white goods manufacturers Whirlpool and Arcelik, it was confirmed on Wednesday. Turkey's Arcelik, which owns Beko and Grundig, is acquiring the European business of America's Whirlpool, which owns Hotpoint and Indesit.

The two companies want to set up a new business consisting of their European units.

When it was announced, Arcelik - which will own around 75% of the new company - said the deal would "drive value creation" for both shareholders and consumers.

But earlier this month the Competition and Markets Authority flagged concerns that the deal could reduce choice, especially in the low-mid price ranges. The new company would be the largest individual supplier of washing machines, tumble dryers, dishwashers and cooking appliances in the UK, a market that is worth more than £3.8bn, according to the CMA.

The regulator gave Arcelik time to provide a solution that would address its concerns, but on Wednesday confirmed that both parties had declined to provide such undertakings.

As a result, the CMA will now launch a phase 2 investigation into the proposed deal.

Arcelik, which is part of Turkish conglomerate Koc Holding, and Whirlpool did not immediately respond to a request for comment.

The European Union's antitrust regulator is also reviewing the deal, with a decision due by 23 October.