The UK competition regulator has warned that Norwegian firm Adevinta’s £6.5 billion merger purchase of Gumtree from Ebay could lead “higher prices and less choice” for consumers.
In July, Shpock owner Adevinta sealed a deal for Ebay’s classifieds business which also gave the US giant a 33.3% voting stake and a seat at the board of its rival.
The Competition and Market Authority (CMA) has now said that, following an initial investigation, it has concerns that the move “could lead to a loss of competition … with only Facebook Marketplace remaining as a significant competitor.
Joel Bamford, senior director of mergers at the CMA, said: “It is important that people have choice when it comes to selling items they no longer require or searching for a bargain online, and that they can enjoy competitive fees and services.
“There is a realistic chance that without this deal Gumtree and Shpock would have been direct competitors to Ebay, which is by far the biggest player in this market.
“This is the latest in a series of merger probes by the CMA involving large digital companies, where we are thoroughly examining deals to ensure that competition is not restricted, and consumers’ interests are protected.”
