CINEWORLD’S £47million acquisition of art house cinema chain Picturehouse, which includes the Abbeygate in Bury St Edmunds, is to be examined by the Competition Commission, it emerged today.

The Office of Fair Trading (OFT) has referred the deal to the commission after uncovering potential issues in five local areas – including Bury where there is also a Cineworld complex – that it fears could limit choice and increase prices for cinema-goers.

Cineworld’s takeover of the 22-strong Picturehouse chain, which was announced last December, could also substantially reduce competition in Aberdeen, Brighton, Cambridge and Southampton, where the two brands also overlap, according to the OFT.

It said initial research, including surveys of 35,000 cinema-goers, showed that many customers viewed 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.

It 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’’.

It also bought Picturehouse’s theatrical distribution arm, Picturehouse Entertainment, which has a number of releases under its belt since launching in December 2010.

Cineworld said yesterday it would assist the Competition Commission in its investigation.