The UK’s antitrust watchdog is making it tougher to execute deals that fall foul of competition rules by pushing companies to find buyers up front for assets they are obliged to sell.

The Office of Fair Trading is cracking down on its previous practice of allowing some deals to close before buyers have been secured for the required disposals, partly as a result of the worsening deal-making environment.

The change – described by the OFT as an “evolution” – means that a company selling an asset will need to ensure there is also a buyer for any assets that have to be hived off for competition reasons.

John Fingleton, OFT chief executive, said: “The quid pro quo for business is that they need to come to us with their buyers lined up. If that’s done we can deal with cases very quickly.”

Bankers and lawyers warned the new policy would derail deals, particularly in a tough market. Gillian Fairfield, partner at law firm Herbert Smith, said: “It might mean that a seller steers clear of someone with an antitrust problem, even if they’re offering the best price.”

She added that the OFT is likely to take a harder line across all sectors after it was earlier this year obliged to release General Healthcare Group Holding Partnership from its post-deal requirement to sell a hospital in Ayrshire because no buyer could be found.

“Upfront buyers may be more prevalent now because we are operating in a very different economic context than five years ago,” Mr Fingleton said.

The ailing food industry has much to lose from the new approach. Caught between rising input prices and weak consumers, the sector has been consolidating in a bid to eliminate capacity and improve bargaining power with a more concentrated retail sector.

Critics said the OFT’s policy would be unlikely to lead to greater competition in the sector. “All the evidence is that for food manufacturers it is extremely hard to get price increases in any case,” one banker said, adding that strong retailers – and weak consumers – created a natural brake on price rises.

In a recent acquisition, the OFT was persuaded to back down, according to people familiar with the situation. Premier Foods, the debt-encumbered maker of Hovis bread and Mr Kipling cakes, sold its canning division to Princes, a canned food company owned by Mitsubishi of Japan.

To satisfy competition issues, Princes was barred from acquiring Fray Bentos, the tinned pie brand, but the OFT agreed to allow Premier to close the deal before it was sold. That deal closed on August 3 and bankers are still seeking a buyer for the pies.

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