Co Antrim cycling firms' merger probed by competition commission
The multi-million pound merger between Co Antrim online bike giant Chain Reaction Cycles and rival Wiggle is now being examined by the Competition and Markets Authority (CMA).
Ballyclare-based Chain Reaction, which employs 600 people, announced it was merging with larger UK rival Wiggle earlier this year, a deal which could create a business with combined revenues of £300m.
And now the CMA says it has begun its inquiry to probe whether the deal could lead to a "substantial lessening of competition".
"The CMA is considering whether it is or may be the case that this transaction has resulted in the creation of a relevant merger situation under the merger provisions of the Enterprise Act 2002 and, if so, whether the creation of that situation has resulted, or may be expected to result, in a substantial lessening of competition within any market or markets in the United Kingdom for goods or services," it said.
Wiggle and Chain Reaction Cycles said the merger would allow them to "further strengthen their position in the global online retailing world of cycling, running, swimming and triathlon (tri-sports) products and accessories".
Chain Reaction's success in the online sales of bikes and accessories has made it a dominant player in sport, and a favourite among cycling fans - and it has benefited from the province's growing profile as a cycling destination.
Northern Ireland played host to the first stage of the world-famous Giro d'Italia in 2014, followed by its Gran Fondo last year. In its most recent results, Chain Reaction Cycles said it had benefited from "increased media exposure from high-profile global events".
The business was founded by George and Janice Watson as a small bike shop in Ballynure in 1984, and their four children run the company, with son Chris the managing director. The family have shied away from most forms of publicity, and were reluctant additions to the Sunday Times Rich List.
Wiggle's history dates back around 24 years, and it was bought over by venture capital firm Bridgeport in 2011.
Chain Reaction founder and managing director Chris Watson said: "This is an exciting new chapter for the Chain Reaction Cycles brand.
"Since the business started in 1984, we've grown strongly from our mountain bike origins in Northern Ireland to meet the needs of more MTB, BMX and road cyclists across more countries.
"Coming together with Wiggle is a great way to continue that growth, as a global force in cycling and a leader in technology, eCommerce and innovation."
Stefan Barden, chief executive of Wiggle, said: "In the global online retailing market in which we operate, there is a compelling industrial logic for our two businesses to come together to become a stronger force.
"The deal propels Wiggle faster towards its objective of building a global online champion and a major British export success story."
Northern Ireland commercial law firm Carson McDowell advised Chain Reaction shareholders on the deal.