The UK Competition and Markets Authority (CMA) has served an initial enforcement order under section 72(2) of the Enterprise Act 2002 in relation to the anticipated acquisition of IHS Markit Ltd. by S&P Global Inc.
Let’s recall that, on 20 October 2021, the parties offered undertakings in lieu of reference to the CMA for the purposes of section 73(2) of the Act. On 26 October 2021, the CMA gave notice to the Parties pursuant to section 73A(2)(b) of the Act, that it considered that there were reasonable grounds for believing that the undertakings offered, or a modified version of them, might be accepted by the CMA under section 73(2) of the Act and that it was considering the Parties’ offer.
The parties entered into a legally binding agreement on 31 July 2021 to divest IHSM’s Oil Price Information business and Coal, Metals and Mining division to News Corp, conditional on approval by the CMA of the purchaser and the terms and conditions of purchase;
Now for the purposes of preventing pre-emptive action in accordance with section 72(2) of the Act the CMA has issued an order addressed to IHS Markit Ltd (IHSM) and IHS Markit Group Holdings (IHSM UK).
IHSM and IHSM UK will have to minimise as far as possible any risk of loss of competitive potential of the Divestment Businesses and in particular ensure that:
- the Divestment Businesses are maintained as a going concern and sufficient resources are made available for the development of the Divestment Businesses on the basis of their respective pre-Transaction business plans;
- except in the ordinary course of business, no substantive changes are made to the organisational structure of, or the management responsibilities within, the Divestment Businesses;
- except in the ordinary course of business, the nature, description, range and quality of goods and/or services supplied in the UK by each of the Divestment Businesses are maintained and preserved;
- the software and hardware platforms of the Divestment Businesses shall remain essentially unchanged, except for routine changes and maintenance and changes that are necessary to facilitate the News Corp divestment;
- no changes are made to Key Staff of the Divestment Businesses; and
- all reasonable steps are taken to encourage all Key Staff to remain with the Divestment Businesses.
At all times, IHSM and IHSM UK must actively keep the CMA informed of any material developments relating to the Divestment Businesses, which includes, but is not limited to:
- details of Key Staff who leave the Divestment Businesses;
- any interruption of the Divestment Businesses (including without limitation its procurement, production, logistics, sales and employee relations arrangements) that has prevented it from operating in the ordinary course of business for more than 24 hours;
- all substantial customer volumes lost by the Divestment Businesses; and
- substantial changes in the Divestment Businesses’ contractual arrangements or relationships with key suppliers.