John Menzies PLC’s (LON:MNZS) acquisition of rival aviation services group Airline Services has been cleared by UK competitions regulators.
Both Menzies and Airline Services supply airlines in the UK with support services such as ground handling and de-icing.
READ: Menzies takeover given provisional clearance
An initial investigation from the Competition and Markets Authority raised concerns that the merger, first unveiled last April, could limit choice for airlines at a number of key airports in England and Scotland.
But the CMA confirmed on Thursday that an in-depth investigation “allayed competition concerns”.
In a statement, regulators said: “Having thoroughly scrutinised the wider evidence base considered in the phase 2 inquiry, it has found that the market for ground handling services has a strong recent history of companies entering and competing for contracts.
“The CMA also found that Menzies and Airline Services are not close competitors in the market for de-icing services, meaning the takeover would not lead to a substantial lessening of competition. The CMA has therefore decided to clear the merger.”
Pension deficit reduced
In response to the clearance, Menzies said: “We now look forward to taking control of the business, driving the identified synergies and boosting our footprint and product offering across our UK business.”
In the same trading update, Edinburgh-based Menzies told investors that its funding deficit has been slashed by more than £50mln over the past four years.
Back in March 2015, the deficit stood at £116mln. It is now nearer to £65mln.
Menzies shares climbed 1.1% to 533p on Thursday morning.