(Corrects to read June (not July), paragraph 7)
(Reuters) -Britain's competition watchdog said on Friday it would refer UnitedHealth (NYSE:UNH) Group's 1.24 billion pound ($1.54 billion) acquisition of healthcare technology firm EMIS for a Phase 2 investigation.
The Competition and Markets Authority (CMA) said it had rejected a remedy offered by U.S.-based UnitedHealth after deeming it did not go far enough in mitigating the potential competitive impact of the combination.
The proposed remedy was a divestiture of the domestic Medicines Optimisation and Population Health Management businesses of Optum UK, part of UnitedHealth.
EMIS said the merging parties disagreed with the decision and were weighing their next steps.
"(We) are disappointed with the CMA's decision and continue to believe that the proposed remedy directly addresses the competition concerns raised by the CMA following its Phase 1 investigation," the company said.
"Optum UK and EMIS are currently considering their options and will provide a further update with regards to the acquisition in due course."
UnitedHealth unveiled an offer to acquire EMIS in June, in a move aimed at positioning the combined entity to provide better services to Britain's National Health Service (NHS).
The CMA launched its initial merger enquiry in January and warned the parties earlier in March that it would subject the deal to further scrutiny if they failed to offer acceptable remedies.
($1 = 0.8073 pounds)