American Express Global Business Travel, has confirmed this week that the U.K. Competition and Markets Authority has published its interim report regarding Amex GBT’s proposed acquisition of CWT, a global business travel and meeting solutions provider.
The CMA’s interim report does not reflect the evidence presented on the highly competitive and dynamic nature of the business travel sector, Amex contends. It attacked the CMA saying it wrongly focused on business travel and accused it of ignoring lots of sources of evidence.
Amex says it will fight back with the UK regulators to correct what it perceves as l errors and misconceptions about how the business travel sector operates and to demonstrate that the CWT acquisition will not harm competition in the UK or elsewhere.
The Amex acquisition of CWT will create synergies and provide greater capacity for investment and innovation, it says. Amex promises the takeover would create more choices for customers and more efficient distribution for suppliers while maintaining a highly competitive environment for business travel services.
With a change of leadership in the U.S. Amex GBT confirmed it will continue to work collaboratively with other regulators, including lobbying the Antitrust Division of the U.S. Department of Justice, in their review of the transaction. Amex doesn't believe the UK's authority will be toothless in its opposition and vows the transaction will be completed during the first quarter of 2025.
Eric J. Bock, Amex GBT’s Chief Legal Officer and Global Head of M&A, said: “We are disappointed by the CMA’s interim report. The CMA has not appreciated the evidence that reflects the breadth of the business travel industry and its dynamic and competitive nature. In recent years, numerous travel management companies have expanded their offerings while other companies have entered the industry and are rapidly growing their businesses. We are reviewing the interim report closely and will be responding to the CMA’s concerns. We firmly believe that the proposed transaction would result in many customer and supplier benefits and that the business travel industry would remain highly competitive. We will be engaging further with the CMA to demonstrate why its concerns are not justified.”
Martin Coleman, chair of the independent inquiry group assessing the deal, said: "Despite the increased use of video conferencing, business travel continues to be a necessary component for effectively doing business for many companies and a major area of expenditure. Business travel also plays an important role in the UK economy, facilitating global trade, supply chains, knowledge exchange and international investment. A cost-effective, good quality and efficient business travel sector is therefore an important underpinning element of UK productivity and economic growth.
We have provisionally found that only a small number of business travel agencies are considered capable of meeting the needs of the largest companies and this deal could reduce competition and increase costs."