The Commerce Commission has declined to grant clearance to the formation of a joint venture between Hamilton Radiology and Medimaging.

Hamilton Radiology and Medimaging each provide x-rays, ultrasound and other low tech services in Hamilton and Cambridge. In the Waikato region, Hamilton Radiology and Medimaging are the only providers of MRI services.

"While the Commission is satisfied that the proposed acquisition will not have, or would not be likely to have, the effect of substantially lessening competition in the market for x-rays, ultrasound and other low tech radiology services, we are not satisfied that the same is true for the provision of MRI services in the Waikato region. This being the case, we must decline the application,” said Commerce Commission Chairman Dr Mark Berry.

The Commission found that with the reduction of two MRI providers to one, difficult conditions of entry and no likely new entrants into the Waikato region, a significant number of patients would likely be adversely affected.

A public version of the written reasons for the decision will be available soon on the Clearances Register.

Background

When considering a proposed merger, the Commission must decide whether the competition that is lost in a market when two businesses merge is substantial. We will give clearance to a proposed merger only if we are satisfied that the merger is unlikely to have the effect of substantially lessening competition in a market. A fact sheet explaining how the Commission assesses a merger application is available on the Merger Assessment fact sheet page.