UK & EU Merger Remedy Purchasers

Specialist competition law advice for divestment purchasers

Buying a business being sold as part of a merger remedy is not an ordinary M&A transaction. Due diligence may be truncated, negotiations that would ordinarily take months may be compressed into weeks, and the purchaser must still satisfy the CMA or European Commission that it is suitable and that the acquisition will provide an effective and durable remedy to the identified competition concerns.

In a competitive divestment process, regulatory credibility can be as important as price. The seller needs confidence that its preferred bidder will obtain purchaser approval and complete the transaction within the required timeframe.

Euclid Law advises strategic purchasers, private equity sponsors and other investors on acquisitions arising from UK and EU merger remedies. We help clients position themselves as credible purchasers, improve their prospects of winning the opportunity and manage the process from the initial bid through purchaser approval to closing.

Helping purchasers win the opportunity

In a remedy sale, it is not just about the price.

The divesting party will usually be operating under binding commitments and a demanding regulatory timetable. Selecting a purchaser that encounters difficulty obtaining approval can delay implementation of the remedy and create risk for the seller’s underlying transaction.

Sellers and their advisers will therefore ask not only which bidder has offered the best price, but which bidder provides the greatest confidence that the competition authority will approve the acquisition and that the transaction will close on time.

We help purchasers answer that question from day one. Our aim is to help clients build regulatory certainty into their bids and use it as competitive leverage.

This means identifying potential issues early, understanding the criteria that the authority will apply and developing the evidence needed to address them. Before a preferred bidder is selected, we help our clients present the seller with a credible and approvable purchaser proposition.

Where competing bids are commercially comparable, that regulatory certainty can make the difference.

Building a credible purchaser proposition

Competition authorities will typically require a remedy purchaser to be independent of the merging parties, financially and operationally capable of operating and developing the divested business, and appropriately incentivised to compete. They must also be satisfied that the acquisition will not itself give rise to competition concerns.

These issues should be addressed before the formal purchaser approval process begins. A bidder that can demonstrate a credible path to approval reduces execution risk for the seller and differentiates itself from competing purchasers.

We work with clients and their transaction advisers to:

• assess the remedy package and applicable purchaser criteria;
• identify operational dependencies, missing assets and potential weaknesses in the proposed divestment permimeter;
• identify competition, ownership, financing and governance issues;
• position the bidder as a credible and approvable purchasers;
• prepare for management presentations and site visits, ensuring the purchaser its operational understanding and capabilities in the best light and is ready to fend the competition authority’s questions about its business plan for the divestment business;
• prepare for and manage the CMA or European Commission purchaser approval process; and
• address remedy-related issues in the transaction documents, separation arrangements and transitional services agreements.

Site visits can be particularly important in a compressed divestment process. They provide an opportunity not only to inspect the relevant facilities and meet management, but also to test the seller’s description of the business, understand how it operates in practice and identify dependencies on the seller that may not be apparent from the data room.

We help clients prepare strategically for those visits, develop focused questions and follow up on issues affecting the viability of the business, the adequacy of the divestment perimeter and the transitional arrangements required after closing.

For private equity-backed purchasers, we also advise on issues arising from fund ownership, portfolio company interests, financing arrangements and governance structures.

Our objective is not simply to obtain regulatory approval. It is to give the seller, its advisers and, where relevant, the monitoring trustee confidence in the purchaser throughout the competitive process.

Our recent experience

Air Incheon / Air Zeta – Asiana Airlines’ global cargo business

We advised Air Incheon (now Air Zeta) on its private equity-backed acquisition of Asiana Airlines’ global cargo freighter business, divested as part of the European Commission’s clearance of Korean Air’s acquisition of Asiana Airlines.

We advised from the inception of the bid through European Commission purchaser approval and closing. Our work included the private equity ownership and governance structure, the purchaser’s financial and operational capabilities, the viability of the divested business and its separation from Asiana. Our instruction has continued through the post-closing transitional services monitoring period.

Current UK divestment mandate – confidential

We are advising the purchaser of a standalone UK business being divested following an international transaction. The purchaser has secured CMA approval for the main transaction.

Our role covers the competition law aspects of the UK divestment and remedy process, including purchaser approval, the scope and viability of the divestment package, and transaction execution.

The wider transaction has also been reviewed separately by the European Commission. The UK and EU proceedings involve distinct merger control and remedy processes.

Current EUMR divestment mandate – confidential

We are advising a prospective purchaser on the proposed acquisition of a package of assets, principally brands, being carved out of a consumer business as part of an EU merger remedy.

Our work includes assessing the remedy package, developing the purchaser proposition and advising on the competition and execution issues arising from the proposed carve-out.

Other purchasers-side mandates

Our other recent work has included advising candidates competing to acquire divestment businesses in the aircraft equipment and petrol service station sectors. These mandates involved early-stage assessment of the remedy package, bidder positioning and the development of a credible route to.

Why Euclid?

Remedy acquisitions require competition lawyers who understand not only how competition authorities and monitoring trustees assess candidate purchasers, but also how divestment transactions operate in practice—whether structured as fix-it-first remedies, upfront buyer remedies or post-closing disposals.

As an independent competition law firm, Euclid offers:

• specialist UK and EU merger control expertise;
• direct access to experienced competition lawyers;
• practical purchaser-side remedy experience, complemented by insights from advising divesting parties;
• experience advising both strategic and private equity-backed purchasers; and
• the independence and flexibility to work seamlessly alongside a purchaser’s corporate, finance and sectors advisers.

We focus on clearing regulatory roadblocks, establishing the purchaser’s credibility and providing a clear path from bid to purchaser approval and closing.

Don’t wait. Speak to us early.

If you are considering bidding for a business or assets being divested as part of a CMA or European Commission merger remedy, there is real value in obtaining competition advice before the competitive auction and formal purchaser approval process begin.

Identifying issues early allows the purchaser to enter the process with its regulatory case already developed—and to give the seller confidence that it can deliver.

In a competitive remedy process, demonstrating that you are the purchaser who can get the deal through can make all the difference.

Competition law deals with the anti-competitive activities of businesses and abuses of dominance. It also regulates state subsidies and controls mergers. The competition law of the EU and of each EU country aims to ensure that the markets remains competitive, and that consumer welfare is maximised through lower prices, quality products, and greater choice. You can find below our areas of expertise: