Competition watchdog to probe Punch takeover

The Competition and Markets Authority (CMA) said it ​i​s looking into whether the takeover may result in a "substantial​" decrease​​ in competition.

Heineken sealed a deal in December to snap up Punch Taverns with private equity firm Patron Capital, having fought off a rival bid from the pub chain's co-founder Alan McIntosh with a 180p-per-share offer.

The Dutch beer giant already owns 1,100 leased pubs across the UK and would add another 1,895 after the takeover, while Patron would acquire 1,329.

Concerns have already been raised over the deal in the industry, with the Scottish Licensed Trade Association calling for the CMA to launch a probe.

The CMA said it ​i​s "considering whether it is or may be the case that this transaction, if carried into effect, will result in the creation of a relevant merger situation" and if so, "whether the creation of that situation may be expected to result, in a substantial lessening of competition".

It has set a deadline of March 2 for comments on the Punch takeover and is to decide whether to take further action by April 24.

Its announcement comes a day after Heineken boss Jean-Francois Van Boxmeer praised British pubs as an "institution" as he unveiled annual profits.

Heineken said on Wednesday that it hoped the deal would go through by the end of the first half of 2017, but a competition inquiry could throw its plans off course.

The group ​reported a ​10 per cent​ rise in annual earnings, although it revealed a £976​m to revenues from the Brexit-hit pound, as well as currency depreciation in other markets

It also cautioned over "volatile" economic conditions over 2017 and said it was expecting a further currency impact of up to £64​m.

​The group made underlying operating profits of £3​bn last year, up from £2.9​bn and sold 3​ per cent​ more beer by volume.