Barratt Developments has stated that it will press on with its merger with Redrow, despite ongoing concerns from the Competition and Markets Authority (CMA).

The housebuilder said it would waive conditions put on the £2.5bn deal by the Government’s competition regulator, after it found that the merger could disadvantage homebuyers in an area around a town in Shropshire.

It stated that the deal is set to complete later this week, with Redrow shares being suspended on Thursday and new Barratt shares being issued on Friday.

Earlier this month, the first phase of the CMA investigation concluded, finding that the merger did not raise competition issues, other than the issue in Shropshire.

In a statement, the CMA said: "This merger will be referred for an in-depth, phase two investigation unless the parties offer an acceptable undertaking to address these competition concerns."

Although Barratt said it would push ahead with getting the court sign-off for the deal, CMA rules mean that the full operational integration of both businesses cannot start until the regulator’s conditions are met.

Investment director at AJ Bell, Russ Mould, said: "The issues raised by the competition authorities always looked surmountable given they were restricted to just one part of Whitchurch in Shropshire and Barratt has waived the CMA clearance condition which had been written into the deal. An enforcement order from the regulator is likely but Barratt and Redrow are ready for it and will presumably do what’s necessary to prevent the probe going any further.

"The all-share deal should allow Barratt to replenish its landbank – a necessary precondition to ramping up volumes – with prices in the open market not having retrenched as much as might be expected in the current cycle.

"Barratt will hope its timing is good as the industry looks to pick itself off the floor following a difficult few years marred by a weak property market and rising interest rates."

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