EC investigates WPP's acquisition of Grey

The European Commission has launched an investigation into the WPP acquisition of Grey Global Group.

The investigation was triggered by concerns that WPP's strengthened position may impede effective competition.

Though an EC investigation is not unprecedented in holding company mergers - the EC also looked into WPP's purchases of Young & Rubicam and Tempus - there may be more cause for concern for WPP this time because of the strength of Grey's MediaCom operation in Europe.

Agency sources said the EC documentation asks some "searching questions" regarding the assimilation of MediaCom into WPP alongside MindShare and Mediaedge:cia.

MediaCom is particularly strong in markets such as the UK and Germany, where WPP's two media networks are already among the largest. WPP is likely to integrate MediaCom into its Group M media unit.

The EC has the power to impose conditions on mergers, such as the sale of assets in individual markets.

Submissions from interested parties must reach the EC by 26 November.