Heineken's Punch Taverns takeover gets the green light from competition watchdog after offering to sell dozens of Punch Taverns pubs

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The Dutch brewer will be toasting the CMA's decision (Source: Getty)

The competition watchdog said today it had accepted proposals by Heineken to resolve concerns over its proposed £403m takeover of Punch Taverns by selling dozens of pubs.

The Competition and Markets Authority (CMA) had opened an investigation into the takeover and found 33 local areas where the deal could reduce competition. So in June, Heineken offered to sell dozens of Punch Taverns pubs to address the concerns.

Read more: Heineken offers to sell dozens of pubs to satisfy the CMA

The suggestion was an opportunity to prevent the merger being referred for a further in-depth investigation.

And today, the watchdog confirmed the proposals were effective, saying:

The CMA is satisfied that its concerns have been addressed and has therefore decided that the merger will not be referred for an in-depth phase two investigation.

Punch shareholders approved Heineken's 180p per share takeover offer in February, after the Dutch brewing giant won a bidding war with entrepreneur Alan McIntosh, one of Punch's founders.

However, less than a week after investors gave the deal the green light, the CMA opened an investigation into the takeover.

The deal would mean Heineken added around 1,900 pubs to its current portfolio.

The CMA had said the newly combined company's pubs "would not face sufficient competition after the merger, which could lead to price increases or a deterioration in the quality of the service on offer".

Heineken's solution was offering to sell pubs in each of the affected areas. The CMA then indicated that this could be an acceptable proposal.

A spokesperson for Heineken said at the time: “We welcome confirmation from the CMA that only a small number of pubs are required to be sold. It’s a sensible outcome and good news for pub-goers across the UK who will see the benefit of well invested pubs in their communities.”

 

Read more: Competition watchdog voices concerns over Heineken/Punch Taverns deal