European Commission (EC) granted (21-Dec-2017) unconditional approval for the proposed acquisition of Zodiac Aerospace by Safran. The EC concluded the transaction would raise no competition concerns in the relevant markets. The commission carried out a broad investigation of the markets where the companies are active. Details include:
- Both companies supply aircraft electrical systems. However, the EC found no serious competition concerns because the increase in market shares resulting from the transaction is very limited and the merged entity will continue to face strong competition from other established suppliers;
- In markets where the merging companies are active at different stages of the supply chain, for example as suppliers of landing gears and wiring systems or related components, the EC found the merged entity would not have the ability and/or incentive to foreclose third parties. This is because alternative suppliers and customers would in any event remain available;
- On the combination of the companies’ product portfolios and any possible detrimental effects on competition by enabling the merged entity to shut out rivals supplying a narrower range of products, the EC found the merged entity would not have the ability and/or incentive to exclude competitors by tying or bundling the supply of different systems and equipment.
In view of the above, the EC concluded the proposed transaction would raise no competition concerns in any of the markets concerned. [more – original PR]