CMA approves Pharmacy2U purchase of LloydsDirect

The regulator published its clearance decision on 12 March, with the full text of on its ruling to be published "shortly". 

The Competition and Markets Authority (CMA) has approved the purchase of LloydsDirect by Pharmacy2U following the completion of the investigations into the acquisition.

Last month, the regulator revoked its initial enforcement order imposed on Pharmacy2U Limited (Pharmacy2U) concerning the acquisition of Metabolic Healthcare Ltd (Lloyds Direct).

In the revocation order issued on February 12, the regulator said its decision was “based on the evidence it has received in its assessment of the Merger to date.”

The CMA served an initial enforcement order under section 72(2) of the Enterprise Act 2002 on Pharmacy2U, P2U Holdings Limited, G Square Capital II L.P., G Square Healthcare Private Equity LLP (collectively, the Acquirer Group) and Lloyds Direct on 28 November 2023.

It announced that it was considering “whether it is or may be the case that a relevant merger situation has been created and 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 United Kingdom (UK).”

The order directed the Acquirer Group and Lloyds Direct not to take any action that might lead to the integration of the businesses or transfer ownership or control of either business, except with the prior written consent of the CMA.

Further, the companies were asked to carry on businesses separately, maintaining separate sales or brand identity, and not to make any changes to the organisational structure and key staff during the investigation period.

On 23 January 2024, the CMA launched its Pharmacy2U/Lloyds Direct merger inquiry, inviting comments on the transaction from any interested party until 6 February 2024 to assist it the assessment.

Although the order has been lifted, the competition watchdog said it is ”continuing to conduct its assessment of the Merger and has not yet taken a decision.”

The CMA will announce its decision on whether to refer the case for a Phase 2 investigation on 19 March 2024.