Cygnet Health Care / Cambian adult services division merger inquiry

The CMA investigated the completed acquisition by Cygnet Health Care Limited of the Cambian adult services division of Cambian Group plc.

Phase 2

Administrative timetable

Date of referral: 3.5.17

Statutory deadline: 17.10.17

Contact

cygnet.cambian@cma.gsi.gov.uk

Cygnet hospital sale to Elysium completes merger remedy

25 April 2018: Cygnet Health Care Limited has sold one of its hospitals to Elysium Healthcare.

Remedy group appointed

15 December 2017: With the acceptance of the undertakings, the merger has now been finally determined and therefore the implementation of the remedy will be undertaken by the Cygnet/CAS remedy group. This group will comprise the following members:

Andrew Popham, Susan Hankey, Ulrike Hotopp and Keith Richards.

Final undertakings

15 December 2017: The CMA has accepted final undertakings and the reference has now been fully determined.

Notice of proposal to accept final undertakings

24 November 2017: The CMA gives notice of the proposal to accept final undertakings and is inviting comments by Friday, 8 December.

Directions to appoint a monitoring trustee

3 November 2017: On 17 October 2017 the CMA directed Cygnet Healthcare Limited, pursuant to the interim order dated 17 October, to appoint a monitoring trustee.

Final report

Provisional findings

23 August 2017: The CMA has provisionally found that Cygnet’s acquisition of CAS may reduce competition in the supply of certain hospital-based mental health rehabilitation services to local authorities and NHS clinical commissioning groups in the East Midlands and in the West Midlands.

Issues statement

9 June 2017: The issues statement sets out the scope of the inquiry. It outlines initial theories on what might be adversely affecting competition, but it does not set out findings or conclusions.

Evidence

The publication of the evidence of any party on the CMA’s webpages does not indicate in any way endorsement by the CMA of the views expressed in the evidence or acceptance of that evidence. Publication in this way is designed to assist public understanding of the issues.

Responses to notice of possible remedies

Response to provisional findings

Hearing summaries

Responses to issues statement

Response to the phase 1 decision

Merger notice

Directions to appoint monitoring trustee

26 May 2017: On 17 May, the CMA directed Cygnet Healthcare Limited, pursuant to the interim order dated 17 May, to appoint a monitoring trustee.

Interim order

18 October 2017: The CMA has published a new interim order following publication of its final report. The interim order of 17 May 2017 will cease to be in force by virtue of section 81(5) of the Act.

26 May 2017: On 17 May 2017, the CMA made an interim order under section 81 of the Enterprise Act 2002 applying to Universal Health Services, Inc. and Cygnet Healthcare Limited, in relation to the completed acquisition by Cygnet Health Care Limited of the Cambian adult services division of Cambian Group plc. The initial enforcement order of 29 December 2016 will cease to be in force on the date of making this order by virtue of section 72(6) of the Act.

Amendments/consents granted

Inquiry group appointed

8 May 2017: The CMA has appointed the inquiry group.

Simon Polito (Inquiry Chair), Thomas Hoehn, Jill May and Andrew Popham

Terms of reference

3 May 2017: The CMA has referred Cygnet’s merger with the Cambian adult services division of Cambian Group plc for an in-depth investigation.

Phase 1

Phase 1 date Action
18 July 2017 Decision published
21 April 2017 Decision announced
22 February to 8 March 2017 Invitation to comment
22 February 2017 Launch of merger inquiry
28 December 2016 Initial enforcement order

Reference decision

Reference unless undertakings accepted

21 April 2017: The CMA has decided, on the information currently available to it, that it is or may be the case that this merger may be expected to result in a substantial lessening (SLC) of competition within a market or markets in the United Kingdom. This merger will be referred for a phase 2 investigation unless the parties offer acceptable undertakings to address these competition concerns. The full text of the decision is available below.

Cygnet Health Care Limited and the Cambian Adult Services division of Cambian Group plc (CAS) overlap in the supply of hospital-based inpatient rehabilitation services to NHS organisations and local authorities in England and Wales. The Competition and Markets Authority (CMA) looked at competition in the provision of rehabilitation services around approximately 40 of the companies’ sites. Whilst the CMA did not identify problems around the majority of sites, competition concerns were identified in relation to the provision of rehabilitation services to patients suffering from long-term mental health issues in 8 areas and patients suffering from personality disorder in 4 areas.

Given these factors, the CMA has found that there is a realistic prospect of a SLC and the merger will therefore be referred to a phase 2 investigation by an independent group of CMA panel members unless Cygnet is able to offer undertakings that address the SLCs identified.

Launch of merger inquiry

22 February 2017: The CMA announced the launch of its merger inquiry by notice to the parties.

Invitation to comment: Now closed

22 February 2017: The Competition and Markets Authority (CMA) is considering whether it is or may be the case that this transaction has resulted in the creation of a relevant merger situation under the merger provisions of the Enterprise Act 2002 and, if so, whether the creation of that situation has resulted, or may be expected to result, in a substantial lessening of competition within any market or markets in the United Kingdom for goods or services.

Initial enforcement order

On 28 December 2016, the CMA served an initial enforcement order under section 72(2) of the Enterprise Act 2002 on Cygnet Health Care Limited, UK Acquisitions No. 6 Ltd and Universal Health Services Inc. in relation to the completed acquisition by Cygnet Health Care Limited of the Cambian adult services division of Cambian Group plc.

Amendments/consents granted

Published 29 December 2016
Last updated 25 April 2018 + show all updates
  1. Link to news story published: Cygnet sale resolves CMA concerns over mental health merger.
  2. Derogations published.
  3. Final undertakings published and remedy group appointments added.
  4. Derogation published.
  5. Notice of proposal to accept final undertakings published.
  6. Directions to appoint a monitoring trustee published.
  7. New interim order published.
  8. Final report published.
  9. Response to notice of possible remedies published (under ‘Evidence’).
  10. Response to provisional findings published (under ‘Evidence’).
  11. Derogation from interim order published.
  12. Responses to notice of possible remedies published (under ‘Evidence’).
  13. Derogation published.
  14. Full provisional findings report published.
  15. Summary of provisional findings and notice of possible remedies published.
  16. Hearing summary published.
  17. Hearing summaries published.
  18. Hearing summaries published.
  19. Hearing summaries published.
  20. Responses to issues statement added.
  21. Full text decision published.
  22. Response to issues statement and derogation published.
  23. Issues statement, merger notice, parties’ response, and derogation published.
  24. Interim order and directions to appoint monitoring trustee published.
  25. Timetable published.
  26. Inquiry group appointed.
  27. Reference decision published.
  28. Reference decision announced and terms of reference published.
  29. Derogation published.
  30. Decision announced: reference unless undertakings accepted.
  31. Derogation published.
  32. Derogation published.
  33. Launch of merger inquiry and invitation to comment issued.
  34. First published.