Posted on February 8, 2019 by staff

Investigation launched into tech merger

The Competition and Markets Authority has launched a full investigation into a merger between two leading ‘assistive tech’ companies.

The CMA referred Swedish company Tobii’s purchase of UK firm Smartbox for an in-depth investigation after finding competition concerns which could lead to higher prices and reduced innovation in the healthcare sector.

Publicly listed Swedish eye-tracking company Tobii announced a 100 per cent acquisition of British assistive tech company Smartbox in 2018.

Tobii and Smartbox design and supply technology to enable people with complex speech and language needs to communicate. These solutions include specialised hardware and software, such as speech generating devices.

In an initial investigation the CMA said it “found the deal could lead to less choice, higher prices and reduced innovation for customers”.

“The companies are the leading suppliers in this sector, and each other’s main competitors,” the CMA stated.

“As such, the CMA is concerned that the merged company would face little competition, which could lead to a reduced range of products being offered, higher prices and fewer new products being developed.”

Mike Walker, its chief economic advisor, said: “These are vital technologies bought on behalf of vulnerable people by the NHS, charities and schools.

“We believe that the merger could stifle innovation and lead to less choice. We will launch a further in-depth investigation if the companies fail to address our concerns.

”Protecting vulnerable consumers is at the heart of the CMA’s Annual Plan.”

In January, the CMA said that it would refer the merger for a full investigation unless the parties offered acceptable undertakings to address the CMA’s competition concerns.

Tobii attempted to do so but the CMA judged that they would not “resolve the concerns in a clear-cut manner”.

A decision on the merger will be made by a group of independent panel members supported by a case team of CMA staff.

Fredrik Ruben, business unit president at Tobii, said recently: “Tobii Dynavox’s ambition is to increase its innovation and empower more people to communicate and to realise their dreams and potential, regardless of disabilities or impairments.

“We are convinced that this merger is a positive thing for the many in need for assistive technology for communication.”