The planned acquisition by the UK’s Whitby Seafoods of local peer Kilhorne Bay Seafoods is to be investigated by the country’s Competition and Markets Authority (CMA).

The CMA is concerned if the deal were to go through it could “result in the creation of a relevant merger situation under the merger provisions of the Enterprise Act 2002”, which might result, in a “substantial lessening of competition” within the market.

Whitby Seafoods, a family-owned scampi supplier based in the seaside town of the same name in northern England, announced the deal this month.

It plans to acquire Northern Ireland-based Kilhorne Bay through its subsidiary Kilkeel Seafoods, which is also based in the province. Terms of the deal were undisclosed.

Whitby Seafoods said the acquisition would see it inheriting “the skills Kilhorne Bay has developed in the peeled langoustine market”.

It said in its acquisition statement the deal was subject to conditions which included regulatory clearance but when contacted by Just Food it said it would not be commenting further while the CMA investigation is ongoing.

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The CMA is inviting comments on the deal by 22 August and has announced the deadline by which it has to decide whether to refer the transaction for a more detailed Phase 2 investigation is 4 October.

In June, Whitby Seafoods announced it was considering redundancies because of a dip in sales and an increase in costs.

Earlier MP Sir Robert Goodwill had warned jobs at the company could come under threat as a result of changes made earlier this year to UK visa requirements that require employees from overseas to pass a written English test.

He said that mainly Filipino fishermen land the langoustines used by the company in its scampi production.

Whitby Seafoods, which also produces fishcakes, supplies major retailers including Sainsbury’s, Tesco and Farmfoods.