Ritchie Bros first revealed plans for a £775m acquisition of Euro Auctions last year.

A CMA initial investigation found that the companies have a very high market share in the supply of auction services for construction machinery, with Euro Auctions being the clear market leader and Ritchie Bros the second largest provider.

The CMA also found that other auction providers were significantly smaller and other methods of sale like marketplaces, listing websites and dealers did not compete with the companies on any meaningful level.

The regulator added “if completed, the proposed deal could lead to a reduction in competition in the UK market, which could result in higher prices for the companies’ customers and a lower quality service.”

Both firms offered undertakings to address the CMA’s competition concerns but the regulator has decided to widen its investigation.

David Stewart, CMA Executive Director, said: “Many businesses across the UK rely on Ritchie Bros and Euro Auctions to buy and sell heavy construction machinery in the UK.

“This merger would combine the two largest auction providers in this sector, risking higher commissions and lower service quality.

“We are not satisfied that the proposed undertakings from Ritchie Bros would fully address these concerns, which is why we are moving on to an in-depth Phase 2 investigation.”