EU Mergers

Phase I Mergers

  • M.8140 KION / DEMATIC (25 August 2016)
  • M.8157 MCKESSON / BLACKSTONE / JV (25 August 2016)
  • M.8160 GOLDMAN SACHS / ALTOR / NAVICO / C-MAP (26 August 2016)

State Aid

Czech Republic hydropower and biogas support schemes approved. On 23 August 2016, the European Commission (Commission) announced that it has approved two Czech schemes to support electricity and heat production from hydropower and biogas, in order to increase energy produced from renewable sources. The Commission assessed the two schemes under its 2014 Guidelines on state aid for environmental protection and energy (which allow Member States to support the production of energy from renewable sources under certain conditions) and as a result, the Commission found the schemes to be in accordance with EU State aid rules.

Commission approves creation of Malta Development Bank. On 24 August 2016, the Commission announced that it has granted approval under the State aid rules for state support for the creation of the Malta Development Bank (MDB). The Commission found that the MDB will carry out non-commercial activities to facilitate access to finance for SMEs and to support infrastructure investment. The Commission assessed these measures under EU State aid rules, which allow Member States to support the development of certain economic activities. In particular, the Commission found that the MDB will provide financing to SMEs and infrastructure projects only where such financing is not available in the market. According to the Commission, this will avoid private investment being crowded out by the State-supported development bank. On this basis, the Commission has concluded that the MDB’s scope of activity will not distort competition in the Single Market.

UK Competition

CMA publishes decision on Grand Central Shopping Centre acquisition. On 22 August 2016, the Competition and Markets Authority (CMA) published the full text of its decision to approve the acquisition of the Grand Central Shopping Centre (GCSC) by Hammerson plc (Hammerson). Hammerson is the owner of the Bullring shopping centre located in central Birmingham and GCSC is a recently-developed shopping centre also located in central Birmingham. As part of its investigation, the CMA assessed the impact of the acquisition on the supply of retail space in central Birmingham. Following its investigation, the CMA found that the acquisition was unlikely to give rise to a substantial lessening of competition because: (a) while the retail spaces offered by Hammerson and GCSC may represent alternatives for some retailers, they are differentiated in some important respects and are not considered as close alternatives by most retailers; and (b) there will be sufficient constraint post-merger from a range of retail spaces in Birmingham City centre, including from the high street.

CMA publishes directions in Tullet Prebon / ICAP merger. On 22 August 2016, the CMA published directions in respect of the anticipated acquisition of ICAP plc’s (ICAP) voice and hybrid broking and information business by Tullett Prebon plc (TP). Following its announcement that it had launched a consultation in respect of undertakings offered by TP in lieu of a Phase II investigation, the CMA has now published directions in which it requires a monitoring trustee to be appointed, for the purposes of securing TP’s and ICAP’s compliance with its Initial Enforcement Order.

CMA decision not to refer anticipated acquisition of Lion Trackhire Ltd. On 25 August 2016, the CMA announced that it has decided not to refer the anticipated acquisition of Lion Trackhire Ltd. by Ashtead Plant Hire Company Ltd. to a Phase II investigation under the Enterprise Act 2002.

CMA decision not to refer anticipated acquisition of Pure Asphalt Company Ltd. On 25 August 2016, the CMA announced that it has decided not to refer the anticipated acquisition of Pure Asphalt Company Ltd. by IKO plc to a Phase II investigation under the Enterprise Act 2002.

CMA accepts further interim undertakings and appoints monitoring trustee in relation to Celesio’s acquisition of Sainsbury’s UK pharmacy business. On 25 August 2016, the CMA published interim undertakings, pursuant to Article 80(2) of the Enterprise Act 2002, that the CMA has accepted from each of Celesio, Lloyds, and Sainsbury’s in relation to the anticipated acquisition by Celesio of Sainsbury’s UK pharmacy business. The most recent undertakings from Lloyds and Sainsbury’s are more detailed than the previous interim undertakings provided by the two parties in early August 2016. In particular, under the new undertakings, Lloyds agrees to protect the Lloyds divestment stores, particularly by maintaining staffing levels and ensuring their continued levels of operation. Celesio undertakes not to take any action that might frustrate Lloyds’ ability to comply with its undertakings. The Sainsbury’s undertakings limit the actions that Sainsbury’s can take in relation to the target stores in the relevant areas, and any publicity about the change of ownership.

The Lloyds undertakings also allow for the CMA to direct the appointment of a monitoring trustee and set out the terms and conditions of such appointment. The CMA has also published directions requiring the appointment of a monitoring trustee. The monitoring trustee is responsible for reporting to the CMA on the extent of integration by the parties in the relevant areas, monitoring compliance and supporting the CMA in taking any remedial action.