A prominent American investment firm has issued a stark warning to British regulators, suggesting that excessive protective measures could signal to international investors that the UK market is becoming increasingly unwelcoming.
The intervention comes as part of the Competition and Markets Authority’s investigation into the £5 billion veterinary services sector. Tweedy Browne, a Connecticut-based investment firm managing $8.6 billion in assets, expressed serious concerns about the regulatory direction in its submission to the CMA.
Jay Hill, managing director at Tweedy Browne, which holds a 5.1 per cent stake in British veterinary services provider CVS Group, emphasised that while value investors are naturally drawn to lower valuations outside the United States, the UK’s regulatory environment is becoming problematic. The firm pointed to frequent policy changes and what it described as “clouded economic thinking” as significant deterrents to international investment.
The CMA’s investigation, which garnered an unprecedented 56,000 responses from pet owners and industry stakeholders, has already impacted market confidence. CVS Group’s share price has halved over the past twelve months, reflecting growing investor unease about potential regulatory interventions.
The veterinary services market has experienced substantial growth since the pandemic, driven by increased pet ownership and consolidation within the sector. However, the CMA’s focus on profitability metrics has drawn criticism from industry players who argue that strong returns are essential for attracting investment and maintaining service quality.
While the CMA maintains its investigation is crucial for protecting consumer interests, the intervention from Tweedy Browne highlights a growing tension between regulatory oversight and the UK’s ambitions to remain an attractive destination for international capital.
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