CMA orders DX to halt combination with Legal Post and First Post

DX Group found itself on the receiving end of an order from the Competition and Markets Authority order on Tuesday, as the authority said it has reason to believe its acquisition of Legal Post and First Post in May could be hindering competition.

The AIM-traded DX Group acquired Legal Post and First Post for a total consideration of £3.25m cash at the end of May.

In its order, the CMA said it has reasonable grounds to suspect that DX Network Services and the businesses and assets comprising the Legal Post and First Post businesses have ceased to be distinct.

It said it is considering, under section 22 of the Enterprise Act 2002, whether it is the case that a “relevant merger situation” has been created, and whether the situation has resulted or may result in a substantial lessening of competition.

The CMA has ordered DX Group not to take any action “which might prejudice a reference of the transaction under section 22 of the Act”.

In its order, it said this could include any action which might lead to the integration of the Legal Post and First Post businesses with the DX business, transfer the ownership of any of the businesses, or otherwise impair the ability of the businesses to each compete independently.

The CMA’s assistant director of mergers, Eithne McCarthy, added that if the DX Group has “any reason to suspect that this order might have been breached it shall immediately notify the CMA,” as well as any appointed monitoring trustee.