The Competition and Markets Authority believes this move could remedy the concerns it had over this deal
Ardonagh has offered to sell Bennetts Motorcycling Services Limited, reversing its deal to buy the bike broker in a bid to address concerns raised by the Competition and Markets Authority (CMA).
The CMA has accepted this proposal from Ardonagh to fully unwind its recent £26m purchase.
This follows an initial Phase 1 investigation due to the CMA being concerned that the merger of Ardonagh and Bennetts may be a worse deal for customers.
Atlanta chief executive Ian Donaldson said: “We are disappointed with the CMA’s Phase 1 findings.
”Rather than enter into a long, burdensome and expensive Phase 2 enquiry we have decided that an appropriate course of action for Atlanta is to divest Bennetts in order to focus on continuing to provide excellent choice and service to motorcycle riders, and to provide clarity for both Atlanta and Bennetts moving forward.
“We remain committed to delivering great value services to customers and will now concentrate our efforts on organic growth with our Carole Nash and Swinton Bike brands.”
The CMA said that this reversal should in principle remedy the competition concerns that it identified and will now consider the detailed aspects of the proposed remedy.
This means that Ardonagh would have a fixed time period to sell Bennetts to a purchaser approved by the CMA if the proposed remedy is accepted.
The CMA has given 25 November 2020 as a deadline on whether it will accept the proposed remedy and it will consult publicly on the offer in the coming weeks.
In the Phase 1 investigation that the CMA announced on 16 September 2020, it said it would refer the merger for an in-depth Phase 2 investigation unless Ardonagh offered suitable actions to address its concerns.
Ardonagh Group completed its purchase of Bennetts in August.
Ardonagh and Bennetts are leading distributors of motorcycle insurance to private customers in the UK.
Ardonagh’s subsidiary – Atlanta Investment Holdings Limited exchanged contracts on 17 February 2020 and following this, Ardonagh voluntarily notified the merger to the CMA.
Not subscribed? Become a subscriber and access our premium content