The intention to merge Ashford and St Peter's Hospitals NHS Foundation Trust and the Royal Surrey County Hospital NHS Foundation Trust has been taken to a second assessment phase.
The Competition and Markets Authority (CMA) said it would continue to investigate plans for the merger before making a final decision on whether or not to allow the merger to proceed.
This will take about six months to complete.
Suzanne Rankin, chief executive at Ashford and St Peter's Hospitals, said: "Although this was not the decision we were hoping for, we understand that the CMA needs to carry out a more-in-depth analysis of our plans to ensure this is in the best interests of patients. Unfortunately this means we will need to wait longer until a final decision is reached."
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