Highlands & Islands

OFT accepts merger of fuel supply firms

petrol pump
Image caption The OFT says the ruling will restore pre-merger fuel competition levels

A "virtual monopoly" in the supply of heating oils and transport fuels in the Western Isles has been avoided after a ruling by the Office of Fair Trading.

Competition concerns were raised after GB Oils acquired Brogan Holdings' oil distribution business on the isles.

But the OFT said it had accepted undertakings from GB Oils to sell the Brogan business to a third party, Highland Fuels.

The merger will not now be referred to the Competition Commission.

The OFT consulted publicly on the proposed undertakings, as well as on the suitability of Inverness-based Highland Fuels as a purchaser of Brogans' oil distribution business.

This included ensuring Highland Fuels had been able to agree a new lease for Brogans' Stornoway site.

Sheldon Mills, director of mergers at the OFT, said: "This merger would have led to a virtual monopoly for the supply of heating oils and transport fuels in the Western Isles.

"However, the sale package agreed today will restore pre-merger levels of competition for the benefit of the local community."

He added: "The OFT believes that Highland Fuels, with its extensive experience of providing this service elsewhere in Scotland, is a suitable purchaser for the divestment business."

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