CCPC clears Circle K/Pelco deal with binding commitments

The CCPC has cleared the proposed acquisition of eight Pelco-operated, Texaco-branded service stations in Dublin and Meath by Circle K, subject to certain legally-binding commitments.

Pelco operates thirteen Texaco-branded service stations, nine of which were originally included in the transaction. Circle K is the largest service station operator in the State, with over 400 Circle K-branded stations across the State.

An in-depth investigation by the CCPC found that while competition would not be substantially lessened in most areas as a result of the transaction, potential issues could arise in certain parts of north Dublin. Circle K holds a large share in the retail sale of motor fuels in Artane and Coolock in north Dublin, far greater than any remaining supplier there. If the transaction went ahead as proposed, Circle K’s share would increase significantly.

After extensive engagement between the CCPC and both parties, commitments were proposed to address the CCPC’s competition concerns. Circle K has agreed not to proceed with the acquisition of the Pelco service station in Coolock as part of the deal and to divest the Circle K service station at 9 Beaumont Road, Dublin 9, to another operator under a long-term lease arrangement.

Following the investigation and in light of the legally-binding commitments made by Circle K, the CCPC has concluded that the transaction will not result in a substantial lessening of competition.

An independent monitoring trustee will be appointed to ensure Circle K complies with the agreed commitments. The trustee will have all the rights and powers necessary to monitor compliance.

The CCPC will publish the full decision on its website within 60 working days, following redaction of confidential information.

Background

Pelco Holdings Limited and Ard Services Limited, a subsidiary of Circle K Ireland Holding Limited, are both active in the retail sale of motor fuels and the operation of forecourt convenience stores in Ireland.

Information about the merger notification can be found at M/24/042 – Circle K/Pelco Holdings Ltd.

The CCPC merger review process

Mergers and acquisitions which meet certain financial thresholds must be notified to the CCPC for review. While the vast majority of mergers and acquisitions raise no concerns, some mergers and acquisitions can reduce competition in a market, for example by creating or strengthening a dominant player. This is likely to harm consumers through higher prices, reduced choice or less innovation.

The work undertaken by the CCPC during a merger investigation varies; however, it may include in-depth economic analysis of the affected market(s) or segments, market research, and consultations with suppliers, customers and competitors of merging parties.

More details on the merger review process are contained in the CCPC’s guidelines and procedures set out on the CCPC website.

Timelines