Experian has backed down over its £275m merger with credit rating checker rival Clearscore after a watchdog warned it could harm competition in the sector.
The firm said it did not believe the Competition and Markets Authority (CMA) would approve the acquisition of the rival and has decided to abandon the proposal.
In November the CMA said the proposed tie-up would “stifle product development” and have a negative impact on customers.
In a statement this morning the company said: “Experian does not believe that the CMA will approve the proposed acquisition of Clearscore on satisfactory terms, despite the dynamism and competitive nature of the market, and the customer benefits arising from the proposed transaction.
“Experian and Clearscore's shareholders have therefore taken the decision to abandon the proposed transaction.”
The CMA launched an investigation into the proposed takeover last August as it feared it could force customers to pay more for credit cards and loans.
Experian offers free and paid-for credit scores to consumers, earning commission when they then take out a credit card or loan, a similar model to that of startup Clearscore, which entered the market in 2015 to quickly become consumers’ most popular free credit check service.