Cineworld is facing a potential full competition investigation over its £47 million takeover of art house cinema chain Picturehouse amid concerns over the impact of the deal.
The Office of Fair Trading (OFT) has referred the acquisition to the Competition Commission after uncovering potential issues in five local areas that it fears could limit choice and increase prices for cinema-goers.%VIRTUAL-SkimlinksPromo%
Cineworld's takeover of the 22-strong Picturehouse chain, which was announced last December, could substantially reduce competition in Aberdeen, Brighton, Bury St Edmunds, Cambridge and Southampton, where both brands overlap, according to the OFT.
The watchdog said initial research, including surveys of 35,000 cinema-goers, showed a sufficient number of customers see their local Cineworld as an alternative to Picturehouse, and that Cineworld "may find it profitable to raise prices after the merger".
Jackie Holland, OFT senior director and decision maker in the case, said: "Our investigation found that although Picturehouse cinemas show art house and foreign language films, a large proportion of Picturehouse's revenue comes from more mainstream films, in direct competition to Cineworld.
'We are concerned that as a result of the merger, cinema-goers in five local areas could face higher ticket prices and a significantly reduced choice of cinemas and films."
The Competition Commission is expected to report back by October 14.
The deal saw Cineworld add 22 Picturehouse cinemas and more than 60 screens to its existing network of nearly 80 cinemas, including the Cameo in Edinburgh, Picturehouse in Stratford, east London, and the Phoenix in Oxford - the chain's founding cinema, bought in 1989.
It also netted Picturehouse co-founder and managing director Lyn Goleby a multimillion-pound fortune, as she was one of the company's major shareholders. The Arts Alliance and investment firm Albion Venture Capital also held significant stakes in Picturehouse.
Cineworld said on announcing the deal that it would help it tap into ''new audiences in a high value and growing part of the market''.
Seven of the craziest supermarket glitches
Cineworld deal may face full probe
One of the most popular glitches, was a wine deal at Tesco back in November 2012, where a series of offers clashed, leaving a bottle of £9.99 wine selling for £1.50.
The 'three wines for £10' deal apparently clashed with a '25% off when you buy six or more bottles' deal. The 25% was accidentally taken off the original price rather than the reduced one, leaving the wine at rock bottom prices. Deal-hunters cleared the shelves around the country.
Perhaps the most popular glitch from Tesco came in June 2011, when instead of taking £4 off the cost of a £20 case of beer, the supermarket accidentally started selling the cases for £4. The ensuring rush was nicknamed the 'beer stampede'.
Sadly not every supermarket pricing glitch comes with such a happy ending for consumers. In March last year the bargain-hunters thought their luck was in, when Tesco accidentally priced the new iPad at just £44.99 instead of around £650. Sadly it spotted the mistake before shipping the goods. The small print on its website meant it could refuse to sell at this price, and refund their customers instead.
In September 2012, Asda was responsible for one of the most expensive glitches. The Asda Price Guarantee offered vouchers to customers who could have got their shopping cheaper elsewhere.
However, when certain trigger products were in the basket, the supermarket massively under-priced the shopping at other supermarkets, and offered huge vouchers to shoppers. In many instances the vouchers came to roughly the same as the cost of the shopping.
In April, a mistake on their website resulted in Tesco selling 8 packs of Bulmers cider 568ml bottles for £5 - rather than a six pack for £8.
Deal-hunters snapped up the deal online, and had varying degrees of success. Some had their order delivered in full, others had six delivered for £5 - and were able to negotiate their way to another two, while others were offered six for £5 or their money back.
October last year saw one of the most famous glitches, when Tesco Terry's Chocolate Oranges were subject to two deals at the same time, and the price dropped from £2.75 to 29p. There were plenty of people getting chocolate oranges last Christmas.
A buy-one-get-one-free deal went awry at Tesco in March. People putting four tubs of I can't Believe It's Not Butter or Oykos yogurt packs into the trolley were only being charged for one.
Soon the online deal-hunting community was in action, with one person bagging 50 tubs of butter and 22 pots of yogurt for £8.79 - a saving of £133.89.