Birtish antitrust watchdog raises concerns over Spreadex's acquisition of Sporting Index's B2C arm

Britain's antitrust watchdog, the Competition and Markets Authority (CMA), has expressed competition concerns over Spreadex's completed acquisition of the consumer-facing arm of Sporting Index. The Authority has given both companies time for a solution before it deepens its investigation.

Spreadex acquired Sporting Index's 'business to consumer' arm from Sporting Group Holding last year. Both companies offer online fixed odds betting services and online sports spread betting services to UK-based customers.

In its phase 1 probe, which specifically examined the online sports spread betting market, the CMA found that the acquisition might lead to a monopoly situation by eliminating the only other licensed UK sports spread betting services provider.

Despite suggestions from Spreadex and Sporting Index that they would face competition from fixed odds betting providers post-merger, the CMA noted insufficient evidence to support this claim.

Sports spread betting involves betting above or below a range of outcomes, offering customers different winning opportunities compared to standard fixed-odds betting. Concerns have been raised that without competition, Spreadex may lose its incentive to offer competitive odds for customers.

Naomi Burgoyne, the Phase 1 decision maker for this case at the CMA, stated: "We believe that this deal could remove competition for sports spread betting services and give Spreadex a monopoly in this market. It is important that customers can rely on competition in the market to keep odds competitive."

Spreadex and Sporting Index have been given five working days to address the CMA's concerns. If satisfactory solutions are not provided, the deal will undergo a more in-depth Phase 2 investigation.

The CMA initiated its formal Phase 1 investigation in February 2024 to assess whether the deal could substantially lessen competition. Phase 2 investigations typically last 24 weeks, extendable by up to 8 weeks in certain circumstances, allowing an independent panel of experts to delve deeper into initial concerns identified in Phase 1.

Sporting Group Holding Limited (Sporting Group), the parent company of Sporting Index, is a subsidiary of French operator La Française des Jeux (FDJ). Sporting Index and Spreadex are the only two licensed operators of sports spread betting in the UK.