The proposed purchase by Wilhelmsen Maritime Services (WMS) of Drew Marine’s technical solutions, fire, safety and rescue business may ‘lessen competition in the supply of [the companies’] products in Singapore, and may lead to price increases, deterioration in quality of products and/or service levels,’ says the Competition Commission of Singapore.
The $400 million acquisition, announced in May, would be the largest purchase in WMS’s history, and, if successful, would see some 400 Drew Marine employees join Wilhelmsen Ships Service.
In September, the UK Competition and Markets Authority gave the go-ahead to the deal after its review Phase 1 of the proposed deal.
However, the Singapore competition watchdog has raised its concerns over the transaction, noting that: ‘In particular, the parties are two of the largest players that possess extensive global networks of end-to-end distribution and ancillary services for the provision of chemicals, gases and equipment to the marine sector, and appear to be each other’s closest competitors.’
It continued: ‘Alternative suppliers may face difficulty achieving sufficient geographic scale to be viable alternative sources of supply and to exert sufficient competitive pressure on the merged entity post-merger, especially for customers that procure on a global basis.’
The interested parties are now able to issue a response to the Competition Commission of Singapore’s statement of concerns, before the deal moves to a Phase 2 review.