Dept.Trade&Industry

Stmnt Re Arriva Plc/ MTL

Dept Trade & Industry
28 March 2000

        ACQUISITION BY ARRIVA PLC OF MTL SERVICES PLC
                              
Kim Howells, Minister for Consumer and Corporate Affairs,
announced today that he has decided not to refer the
acquisition by Arriva  of MTL to the Competition Commission
provided Arriva give undertakings to remedy competition
concerns raised by the merger.    Dr Howells' decision is in
accordance with the advice of the Director General of Fair
Trading (DGFT).

Kim Howells said:

'This merger raises significant concerns in the supply of
bus services in Merseyside.  I consider that, in bringing
together the two largest providers of  such services, the
merger is likely to give rise to a loss of actual and
potential competition in the area.    I have decided that
this concern can be addressed by requiring Arriva fully to
dispose of the former MTL depot at Gillmoss as a going
concern with most of the bus services operated from that
depot.     Arriva has proposed that it should retain and
rationalise three services currently operated from Gillmoss,
with the aim of reducing overbussing on certain routes,  and
I am minded to accept this proposal.

I have also decided that the divestment should be supported
by behavioural undertakings designed to protect the position
of a new operator, including a requirement that, for a
suitable period,  Arriva will not register services in
direct competition with those to be retained at Gillmoss,
and requirements concerning the timing of and fares on
existing services that may compete with those from the
Gillmoss.

If undertakings can be agreed which are appropriate to
address the adverse effects of the merger, there will be no
reference to the Competition Commission.      I have asked
the DGFT to seek appropriate undertakings, and to advise me
further by 25 April 2000.'

It is proposed that the divestment should be required within
a period of four months of the undertakings being formally
agreed.  Interested parties are invited to make their views
known on the appropriateness of these measures to remedy the
adverse effects of the merger. Representations should be
made in writing to the Office of Fair Trading by 11 April
2000.   A second consultation will take place on the draft
undertakings themselves, before Dr Howells takes his final
decisions on this case.

The services currently operating from Gillmoss which Arriva
has proposed it should retain are numbers 14A/B, 53/55 and
12/13.


Notes to Editors

1.   Section 75G of the Fair Trading Act 1973 (inserted by
section 147 of the Companies Act 1989 and amended by the
Deregulation and Contracting Out Act 1994) enables the
Secretary of State to accept undertakings as an alternative
to making a merger reference to the Competition Commission.
The Secretary of State must consider whether such
undertakings remedy or prevent adverse effects of the merger
specified by the DGFT.

2.    Interested  parties wishing to make representations
on  the  contents  and  scope of the  undertakings  which
should be offered by FT should do so in writing by 5pm on 11
April  2000  to Bob Gaddes, Office of  Fair  Trading,
Fleetbank  House, 2-6 Salisbury Square, London EC4Y  8JX:
fax 0171 211 8916.