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Home » Home Appliances Merger Could Reduce Choice for Consumers

Home Appliances Merger Could Reduce Choice for Consumers

by Theo Atkinson
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The CMA has found that Arçelik’s anticipated purchase of Whirlpool’s major appliances business in Europe could reduce choice in the supply of washing machines, tumble dryers, dishwashers and cooking appliances.

The transaction will be referred for an in-depth Phase 2 investigation unless Arçelik offers undertakings to address the Competition and Markets Authority’s (CMA) concerns.

Arçelik A.S.(Arçelik) is a global supplier of a broad range of home appliances and consumer electronics, including the Beko and Grundig brands. Whirlpool Corporation (Whirlpool) is a supplier of a full line of domestic appliances, including the Hotpoint and Indesit brands.

The CMA found that, should the deal go ahead, the merged company will be the largest individual supplier of washing machines, tumble dryers, dishwashers and cooking appliances – a market worth over £3.8 billion in the UK.

Arçelik and Whirlpool’s position is particularly strong in the low to mid-range price categories of these domestic appliances, where they would face competition from only a small number of competitors.

The CMA is concerned that this lessening of competition may result in higher prices or a reduction in choice or quality for customers.

Sorcha O’Carroll, CMA Senior Director of Mergers said:

The proposed deal will combine 2 major providers of home appliances in the UK, meaning that well-known brands such as Hotpoint, Indesit and Beko will sit under one owner. We’re worried that this could reduce the choice of suppliers available to retailers and ultimately to shoppers.

As competition from other suppliers in the low-mid price range appears to be limited, we are concerned that this tie-up could leave people paying more or receiving lower quality products. Unless Arçelik offers a solution to address our concerns, we’ll move to an in-depth investigation.

Source : Gov.UK

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