Antitrust Law Daily Wrap Up, ACQUISITIONS & MERGERS NEWS: EC clears pharmaceutical, telecom deals, subject to divestments, (Aug 4, 2016)

By Greg Hammond, J.D.

The European Commission (EC) has approved pharmaceutical company Sanofi’s proposed acquisition of Boehringer Ingelheim’s businesses in the Czech Republic, Estonia, Hungary, Greece, Ireland, Latvia, Poland, and Slovakia. The approval was conditioned, however, on certain divestments, the EC has stated.

Although the EC found no competition concerns for most of the markets, it did identify a few markets where the two companies had very strong brands with a lack of alternatives to the companies’ products, which the EC believed could have led to higher prices and less choice for consumers. To address these concerns, Sanofi has offered to divest either its own or Boehringer’s local businesses in the antispasmodics, anti-constipation, chesty cough, and headache markets. The commitments addressed all of the EC’s concerns.

Telecom joint venture. Separately, the EC announced that it has cleared the proposed joint venture in the Netherlands by mobile telecom operator Vodafone and cable company Liberty Global. The approval, however, is conditioned on Vodafone divesting its consumer fixed line business in the Netherlands.

The divestments quelled the EC’s concerns that the merger would have reduced competition in the markets for fixed multiple play services and for fixed-mobile multiple play services in the Netherlands. In particular, the EC noted that the deal would have removed Vodafone as a player with the potential to exercise a strong competitive constraint in those markets, which would likely have resulted in higher prices and reduced competition.

Technical services acquisition. The acquisition of Voith Industrial Services of Germany by Triton Fund IV of the United Kingdom also has been approved by the EC. Voith is a provider of technical services in the automotive, engineering, and energy-petrochemicals sectors, while Triton is a private equity investment firm. The proposed deal did not raise competition concerns, according to the EC, because there were very limited overlaps between the activities of the companies, demonstrating that the deal would have had a very limited impact on the market.

Companies: Sanofi S.A.; Boehringer Ingelheim GmbH; Vodafone Group; Liberty Global; Voith Industrial Services; Triton Fund IV

News: AcquisitionsMergers Antitrust