CMA investigating First Scotland East acquisition

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The Competition and Markets Authority (CMA) is investigating the completed acquisition by East Coast Buses Ltd, a wholley-owned subsidiary of Lothian Buses, of the East Lothian operations of First Scotland East Ltd.

On September 15, 2016, the CMA served an initial enforcement order on Transport for Edinburgh Ltd (Lothian Buses’ parent company) and its subsidiary East Coast Buses Ltd in relation to the completed acquisition.

The order prevents Transport for Edinburgh from taking action to further integrate the acquired business within its own operations or impairing the ability of the East Lothian First Scotland East business from competing independently in any of the markets affected by the transaction.

The CMA said: “We have reasonable grounds for suspecting that it is or may be the case that East Coast Buses Ltd and certain assets and employees relating to the East Lothian operations of First Scotland East Ltd have ceased to be distinct.

“The CMA is considering whether the creation of that situation has resulted or may be expected to result in a substantial lessening of competition in any market or markets in the UK.”

Richard Hall, Managing Director of Lothian Buses, said: “This step is standard practice under these circumstances and was wholly anticipated.

“We will offer the CMA our full co-operation during this investigative period.

“Having taken legal advice before the acquisition we remain confident that after the conclusion of the CMA’s work East Coast Buses will remain in a position to continue providing lifeline services to the people of East Lothian.”