Baker Hughes deal for Altus may hurt competition in oil well services, CMA says
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The U.K.'s Competition and Markets Authority said Tuesday it is referring Baker Hughes' (NASDAQ:BKR) proposed acquisition of Altus Intervention for further investigation on concerns the deal could reduce competition among British oil and gas operators.
The CMA said the loss of rivalry between the merging companies may lead to higher prices, reduced choice and lower quality services for businesses in the U.K. that buy coiled tubing and pumping services.
The two companies have five working days to submit proposals to address the CMA's concerns, otherwise the competition watchdog will refer the deal to an in-depth phase 2 probe.
In the U.K., Baker Hughes (BKR) and Altus are the two biggest providers of both coiled tubing and pumping services, which are essential for oil and gas operators in managing well production.
Baker Hughes (BKR) recently raised its dividend and upsized its stock buyback authorization by $2B.