§ Mr. Gouldasked the Secretary of State for Prices and Consumer Protection when he expects to publish the report of the Monopolies and Mergers Commission into the proposed merger between Pilkington Brothers Ltd. and UKO International Ltd.; and whether he will make a statement.
§ Mr. John FraserThe report is being published today. The commission, with one member dissenting, has found that the proposed merger between Pilkington Brothers Ltd. and UKO International Ltd. may be expected to operate against the public interest.
Although not excluding the possibility of benefits to the public interest arising from the merger, the commission considered there to be a greater probability of detrimental consequences and that these outweighed any potential benefits. The particular effects, adverse to the public interest, which the commission foresaw were:
- 1. a risk that Pilkington might not give sufficient priority to the immediate needs of the British mass lens industry;
- 2. a risk that Pilkington might not give sufficient priority to the development of plastic lenses;
- 3. the reduced likelihood that the British ophthalmic glass industry and the British lens industry would remain competitive internationally if UKO ceased to be an independent company in a position to exert pressure on Pilkington;
- 4. the risk of increased prices for blanks and lenses;
- 5. the risk of adverse effects on the United Kingdom balance of payments;
- 6. the risk of discrimination against independent prescription houses.
The commission was unable to recommend any actions that would remedy or prevent the adverse effects mentioned and has therefore recommended that the merger should not be permitted.
My right hon. Friend, in the light of the Commission's findings, agrees that the merger should not go ahead and is asking the Director General of Fair Trading to seek an undertaking from Pilkington to that effect.