MCC Clears Swan Securities and Capital Markets Brokers Merger

The Mauritian Competition Commission has granted conditional approval for the merger of Swan Securities Ltd (SSL) and Capital Markets Brokers Ltd (CMB), following an investigation into potential market dominance.

The decision, announced by the Commission, comes after a detailed assessment of how the consolidation would affect the brokerage services sector.

While the merger has been cleared to proceed, it is strictly subject to specific commitments made by both companies to ensure market stability.

Addressing Competitive Concerns

The investigation was triggered by concerns that the deal could “significantly reduce competition” within Mauritius.

The Commission’s inquiry highlighted an increase in concentration within a sector already defined by a limited number of players.

Vipin Naugah, Executive Director of the Competition Commission, initially expressed reservations regarding the impact the merger could have on competitive dynamics.

However, it was determined that these concerns did not warrant an outright rejection of the deal.

Binding Commitments

To secure approval, SSL and CMB proposed a series of corrective measures aimed at mitigating the risks identified during the probe.

The Commissioners have now made these engagements legally binding, ensuring that the merged entity operates within the agreed parameters.

Market Context

Mr. Naugah noted that the Mauritian brokerage market has faced structural constraints for several years due to its restricted size. He observed that:

• Market scale often limits the ability of firms to diversify and improve services.
• Consolidation is a reality of the current landscape.
• Effective competition must be preserved to protect consumer interests.

The Commission concluded that while consolidation can be a response to market constraints, the imposed conditions are essential to maintaining a fair environment for all stakeholders.

Source: Defi Media