The US-based NortonLifeLock had been planning to purchase UK firm Avast for £6bn but the CMA is now considering an “in-depth investigation” into the merger before the transaction is allowed to continue.
Both firms offer cyber safety software to consumers under a variety of different brands. Products include antivirus software (also known as endpoint security software), privacy software (such as VPNs) and identity protection software.
As the companies are close competitors, with few other significant rivals, the CMA said it was concerned that if completed, the proposed deal could lead to a reduction in competition in the UK market.
This could lead to UK consumers getting a worse deal when looking for cyber safety software in the future, it added.
David Stewart, CMA executive director, said: “We are living more of our lives online and it is vital that people have access to competitive cyber safety software when seeking to protect themselves and their families...