Kingspan is to face an antitrust probe over its proposed acquisition of steel cladding provider Coverworld.
The Competition and Markets Authority (CMA) said it had decided to investigate the transaction and was inviting comments on its potential impact on competition.
The invitation to comment was the first part of its information-gathering process, the regulator said, stressing that it had not yet launched a formal investigation.
“The CMA is considering whether it is or may be the case that this transaction, if carried into effect, will result in the creation of a relevant merger situation under the merger provisions of the Enterprise Act 2002,” it said.
“And if so, whether the creation of that situation may be expected to result in a substantial lessening of competition within any market or markets in the United Kingdom for goods or services.”
Kingspan, which manufactured around 5 per cent of the insulation used by contractors on Grenfell Tower, was one of the companies criticised extensively by the public inquiry into the 2017 fire at the building.
Earlier this year, it was threatened with a complete ban from public work in the UK after exhibiting what housing secretary Angela Rayner described as “disgraceful mercenary behaviour”.
Chesterfield-based Coverworld is a producer and supplier of single and twin skin coated steel cladding systems.
Its most recent accounts for the year ending 30 June 2024 showed a turnover of £26.31m, a decrease of 17 per cent on the year before, which the directors blamed mainly on the global fall in steel prices.
The invitation to comment closes on 9 July.
In 2020, the CMA investigated Kingspan over its planned acquisition of materials supplier SIG’s building solutions division.
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Kerry Lorimer