Both companies provide pay-to-use and free-to-use cashpoints (ATMs) across the UK.
The CMA launched an investigation into the $460m acquisition in January, and referred it for a phase 2 probe by an independent group of panel members on May 15, 2017. The group studied whether the merger would reduce competition and result in higher surcharges at pay-to-use cashpoints.
In its report, the group concluded that the presence of free-to-use ATMs and the availability of alternative non-cash payment methods could limit such surcharges at pay-to-use machines.
It was also found that contracts and relationships with the owners of sites where ATMs are installed would restrict the merged company’s incentives to hike surcharges. The group also found that ATM surcharges are not set according to local competition and that the merger would not change this.
With the CMA approval, Cardtronics will begin work on combining the existing UK operations of Cardtronics and DirectCash Payments. Cardtronics’ acquisition of DirectCash Payments has not been subject to review in any other country.
CMA Inquiry Chair Alasdair Smith said: “We’ve looked carefully at the scope for the merger to result in cashpoint users paying higher charges at pay-to-use ATMs. As part of our in-depth inquiry, we surveyed consumers and spoke to the owners of a wide range of premises at which these machines are installed.”
“We’ve found that the merger does not provide the merged company with an incentive to increase surcharges for people using pay-to-use ATMs, not least because of the increasing use of non-cash payment methods and the decline in the use of pay-to-use ATMs relative to free-to-use ATMs,” Smith added.
Cardtronics provides services to 237,000 ATMs in North America, Europe, Asia-Pacific, and Africa.
