Stonegate given conditional approval for Ei Group acquisition

The Competition and Markets Authority (CMA) has given conditional approval for Stonegate's £1.27b acquisition of Ei Group.

It has found that the deal does not raise competition concerns on a national level, but that there would be reduced choice for pub-goers in 51 local areas.

The CMA said: "The CMA is therefore concerned that, if the businesses were to merge, pub goers in those areas could be faced with price increases or lower quality products and services."

The pub groups now have until 13 December to reassure the CMA regarding these concerns.

Ei Group welcomed the announcement, adding that it would "put proposals to the CMA to address the concerns that it has raised".

In a statement Ei Group said: "The parties are confident that these proposals will enable the transaction to be approved by the CMA without a Phase 2 referral and our expectation remains that the transaction will complete in the first quarter of 2020. Further announcements will be made in due course."

The acquisition of Ei Group by Stonegate would create a 5,000-strong pub group.