Global Business Travel Group (GBT) and CWT Holdings LLC (CWT) are both major suppliers of business travel agency services to corporate customers around the world. GBT announced its intention to acquire CWT for $570 million in March 2024.
The CMA is concerned that the merger could lead to worsened quality of service, higher prices and/or reduced innovation efforts for global multinational (GMN) business travel customers, as a result of combining the current largest and third largest company operating in this market. Following the merger, there would be a very small pool of providers capable of catering to the business travel needs of GMN customers.
The parties have until 6 August 2024 to offer undertakings to the CMA to address the SLC. If no such undertakings are offered or the CMA decides that any undertaking offered is insufficient to remedy its concerns to the Phase 1 standard, then the CMA will refer the merger for an in-depth Phase 2 investigation.
Mike Walker, Chief Economic Adviser at the CMA, said:
We're concerned this deal between major suppliers of business travel agency services would reduce the pool of providers of these services to GMN customers, which could lead to worse services and higher prices for GMN customers.
It is now up to GBT and CWT to offer solutions to our concerns, otherwise this case will proceed to a more in-depth Phase 2 investigation.
