The competition watchdog has said the merger of two of the UK’s largest scampi suppliers will push up the price for pubs and restaurants and lead to “lower quality” for consumers.
The Competition and Markets Authority (CMA) has found that Whitby Seafoods’ purchase of Kilhorne Bay Seafoods will lead to “customers facing the risk of higher prices.”
The CMA’s initial probe found the lack of competition as a result of the merger could also reduce the quality of products.
The watchdog will work with Whitby and Kilhorne Bay to offer solutions “which will fully resolve” the CMA’s concers.
CMA senior director of mergers, Colin Raftery, said: “Scampi is a popular choice when eating out in the UK, with over 20 million servings sold to restaurant, cafe, and pub-goers every year.
“These venues are already facing significant cost pressures, and it’s critical that we don’t allow a loss of competition to make things worse.
“Kilhorne Bay is a relatively small player, but Whitby Seafoods already faces only very limited competition when competing for food service customers – so the deal would leave customers facing the risk of higher prices and lower quality products.”