Rival calls for Brulines/Nucleus merger to be referred

Dispense monitoring company Cotec Technology has lodged a formal objection with the Office of Fair Trading (OFT) to the proposed acquisition of Nucleus Data by Brulines.

Teeside-based Cotec is expected to launch its own bid to purchase the Tadcaster based company should the merger be disallowed by the OFT, which is expected to rule on the matter in the next month or so.

Earlier this month Brulines announced it was seeking to acquire Nucleus for a sum of £3.8m. The deal would see Brulines with its dispense monitoring equipment in more than 20,000 pubs in the UK.

Speaking of its opposition to the Brulines move, a spokesman for Cotec said: "Despite all of Brulines' hype, in our opinion the proposed merger is not good news for the pub industry. That is usually true of any monopoly situation, and we are hoping that the OFT finds the same."

The spokesman said the merger was "anti-competitive, which is ultimately bad for the clients.

"We are not sure how much consultation has taken place, however it's likely that there will be a good number of tenants with Nucleus systems installed, who will have greeted the acquisition news with dismay. Brulines' dispense monitoring has often proved to be controversial.

"We would encourage anyone who feels they may be adversely affected by this merger to contact the OFT without delay as the deadline for comments is September 18, 2007."

Brulines' chief executive James Dickson rejected Cotec's claim that its proposed bid for Nucleus was anti-competitve.

"Assuming it gets the go-ahead from the OFT this will be a good strategic fit and good for our customers and those of Nucleus. There are players entering the market all the time and we're just trying to accelerate our development of new products," he said.