My right hon. Friend the President of the Board of Trade announced his decision to block the proposed bid for Mid Kent Holdings plc by General Utilities plc and Saur Water Services plc on 21 January. That decision was in line with the recommendation in the Monopolies and Mergers Commission report which he published on the same day, and the advice of the Director General of Fair Trading and the views of the Director General of Water Services.
I thank my hon. Friend for that prompt reply, and I welcome the decision. In view of the fact that, collectively, the two companies have a 38 per cent. holding in Mid Kent, may I ask my hon. Friend what reassurances he can give to the company that that situation will not happen all over again?
My right hon. Friend the President of the Board of Trade has made it clear that the proposed bid by General Utilities and Saur for Mid Kent will be blocked and that undertakings will be sought by the Director General of Fair Trading from both companies. Those undertakings will be intended to ensure that those aspects of the proposed merger that the MMC identified as operating against the public interest are effectively prevented now and in the future.
I, too, congratulate the Secretary of State on a decision that will be warmly welcomed in much of Kent, and is clearly in the best interests of Kent and competition policy generally. Does my hon. Friend accept that that situation has arisen because rival companies have pooled their shareholdings to undermine previous undertakings? In the absence of the compulsory divestment of shares—which my right hon. Friend the Secretary of State is not seeking—how can we be sure that the situation will not arise again? Can my hon. Friend ensure that the undertakings will prevent the bid from being repeated or, indeed, being repeatable?
The honest and candid answer to my hon. Friend must be vigilance on his part, and on the part of my right hon. and hon. Friends who represent constituencies in Kent and of the Director General of Fair Trading. If he or his constituents suspect that something that they do not want is about to occur, they must tell the Director General of Fair Trading straight away.