Dixons and Carphone Warehouse merger could face competition investigation

The proposed merger between Dixons and Carphone Warehouse could face an investigation from the UK competition commission.

Yesterday the shock move was proposed between the two managements that could see Carphone Warehouse crack the electronics sector, and Dixons Retail finally grab a foothold in the smartphone market. The new business will reportedly be worth 4bn and have 1,200 shops in the UK.

Freddie George, an analyst at Cantor Firzgerald, told The Telegraph that the competition authorities may get involved "in view of the convergence of technologies and service dominance of the two businesses even though there is limited overlap in the categories’.

Shares in Dixons rose two per cent on Tuesday after reports of the merger, while Carphone Warehouse shares fell 1.5 per cent.