An eye tracking developing company has been ordered to sell a newly acquired business after it was ruled that their completed merger could lead to a reduction in the range of products available and higher prices. The judgement was passed by the Competitions and Markets Authority (CMA) following Tobii’s purchase of Smartbox Assistive Technology in October 2018.
Smartbox, which has bases in Malvern, Bristol and the US, employs about 70 people. Its net sales in 2017 were £9.3m. In its final report, the CMA said the deal “raises significant competition concerns” in the supply of augmentative and assistive communication products, where Tobii and Smartbox compete closely.
The eye tracking technologies supplied by Tobii and Smartbox help people with complex speech and language needs to communicate using specialised software and devices, such as joysticks, eye gaze cameras and speech-generating systems.
These products are bought on behalf of those who need them by the NHS, charities and schools.
Following an in-depth investigation, a group of independent CMA panel members concluded that the loss of competition brought about by the deal could lead to reductions in the existing product range and quality, less new product development and higher prices.
The CMA has decided that the only effective way of addressing the loss of competition resulting from the merger is for Tobii to sell Smartbox to a new owner, which must be approved by the CMA.
Kip Meek, chair of the independent inquiry group carrying out the investigation, said: “Competition plays a key role in driving improvements in product range and quality – making a real difference for the people who use these technologies to communicate.
“Competitive pricing also helps to make sure that public bodies aren’t paying more than they should for these technologies.
“Our investigation concluded that the loss in competition brought about by this deal could therefore have very serious effects – less choice, less product development and higher prices.
“Having carefully considered all options, we decided that only selling the entire Smartbox business would effectively address the concerns we found.”
