A recent fuel supply business acquisition has sparked legal uncertainty after it emerged the deal was not notified to the competition regulator.
Fuels business Klass Securities, through its subsidiary, Klass Energy, based in Ashbourne, Co Meath, bought McMullen Oils in Co Cavan in September 2023.
However, the Competition and Consumer Protection Commission (CCPC) has said the deal is void as the pair failed to notify it and seek its approval before proceeding with the transaction.
The companies only notified the commission of the transaction last week, while the law obliged them to notify it and get approval in advance.
The Competition Act, 2002 requires parties to an acquisition to notify the CCPC where their individual turnovers in the previous financial year were €10 million or more or the combined turnover of the businesses is €60 million or more.
“Where a merger or acquisition is required to be notified to the CCPC, but the parties put it into effect without obtaining prior clearance from the CCPC, the merger or acquisition remains void unless and until it is subsequently cleared by the CCPC,” the commission said in a statement.
The commission, which oversees mergers and acquisitions, has told Klass and McMullen that they cannot put the deal into effect without first notifying it and then receiving approval.
Sources said that contracts agreed as a result of the transaction could be open to challenge, as legally the deal has not been completed.
A CCPC spokeswoman noted that the Competition Act, 2002, did not set out the implications for the parties to a merger or acquisition if the transaction is void.
“It is for the parties involved to assess that,” she said.
McMullen Oils has been operating as part of the Klass Energy group since the Co Meath business bought the firm in 2023.
The commission has begun reviewing Klass’s acquisition of McMullen and said a determination would be made in due course in accordance with its merger review process.
The CCPC reviews all mergers and acquisitions where the parties' turnovers meet the notification threshold to ensure that the transaction does not hinder normal commercial competition.
After a phase one review, the commission can approve the deal or go to a longer, more detailed phase two investigation.
The commission can approve deals as agreed or impose conditions on the parties before allowing mergers or acquisitions to go ahead.
Klass Securities did not respond to requests for comment.
Klass Securities owns several businesses that distribute and sell home heating oil, motor fuel, kerosene and agri-diesel. It is one of the leading players in that business in the Republic. McMullen Oils is a fuel distributor based in Cootehill, Co Cavan.
