ByBox / Pelipod merger inquiry
| Date | 21 February 2023 |
| Decision Date | 21 February 2023 |
| Subject Matter | Mergers |
| Court | Competition and Markets Authority (EW) |
Acquisition by ByBox Holdings Limited
of Pelipod Limited
Decision on relevant merger situation and substantial
lessening of competition
ME/7035/23
Please note that [] indicates figures or text which have been deleted or replaced in
ranges at the request of the parties or third parties for reasons of commercial
confidentiality.
SUMMARY
1. ByBox Holdings Limited (ByBox) has agreed to acquire Pelipod Limited (Pelipod)
(the Transaction). ByBox and Pelipod (each a Party) are together referred to as the
Parties and for statements referring to the future, as the Merged Entity.
2. The Parties overlap in the supply of Field Service Distribution Services (FSDS) in
the UK. FSDS comprise a range of logistics solutions which enable businesses with
field workforces to distribute (and return) parts and equipment to employees and
contractors (typically engineers) working at different customer locations on a daily
basis.
3. The Competition and Markets Authority’s (CMA) primary duty is to seek to promote
competition for the benefit of consumers. It has a duty to investigate mergers that
could raise competition concerns in the UK, provided it has jurisdiction to do so. This
can be established based on either the turnover of the target entity or the combined
shares of supply of the merging entities. The CMA believes that it has jurisdiction to
review the Transaction because the Parties' combined shares of supply exceed 25%
in the supply of FSDS in the UK.
4. After examining evidence of customer requirements and preferences, the CMA
found that customers place most importance on the delivery time of their chosen
FSDS solution (with customers often referring to requirements for in-night, pre-7am
or pre-8am deliveries) rather than the nature of the specific drop-off point. The CMA
has also seen evidence of customers switching from the lockers that the Parties
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overlap in to other types of FSDS solutions, particularly to those solutions capable of
meeting the in-night delivery requirement. The CMA has therefore assessed the
impact of the Transaction in the supply of ‘in-night’ FSDS in the UK. This includes
locker services, pick-up drop off (PUDO), in-boot and forward stock locations (FSL).
5. The CMA has found that the Parties are close competitors, as they both provide a
locker solution to FSDS customers, although Pelipod’s offering is generally seen as
a weaker offering than ByBox’s. However, the CMA has also found that the Merged
Entity will face competitive constraints from several other FSDS suppliers providing
lockers, PUDO, FSL, in-boot and courier services. Those constraints include an
increased constraint from TVS Rico, a close competitor to the Parties, that
announced plans to develop its own locker network in March 2023.
6. Consequently, the CMA believes that these constraints, taken together, are
sufficient to ensure that the Transaction does not give rise to a realistic prospect of a
substantial lessening of competition (SLC) as a result of horizontal unilateral effects
in the supply of in-night FSDS in the UK.
7. The Transaction will therefore not be referred under section 33(1) of the Enterprise
Act 2002 (the Act).
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