Antitrust Law Daily Wrap Up, ANTITRUST NEWS: Yard management systems software provider must divest assets to settle FTC charges, (Jul 22, 2013)

By Tobias J. Gillett, J.D., LL.M.

Solera Holdings, Inc., a provider of software to the automotive recycling industry, has agreed to divest yard management systems (YMS) assets under the terms of a proposed FTC consent order to settle charges that its 2012 acquisition of Actual Systems of America, Inc. was anticompetitive (In the Matter of Solera Holdings, Inc., FTC File No. 121 0165).

On May 29, 2012, Solera acquired the stock of Actual Systems, Actual Systems U.K., Ltd., and Beech Systems Ltd. for a total of approximately $8.7 million. According to the FTC’s complaint, Solera, through its wholly-owned subsidiary Hollander, Inc., and Actual Systems were two of only three “meaningful” producers of YMS software used by automotive recycling yards in the United States and Canada. The FTC contended that the transaction eliminated competition between Solera and Actual Systems, substantially increased the concentration in the YMS market, and increased the likelihood that Solera would unilaterally exercise market power in that market.

The proposed consent order requires Solera to divest the Actual Systems assets located in North America that it obtained in the acquisition to ASA Holdings, Inc., an entity formed by former Actual Systems managers to acquire the divested business. Solera must also grant a royalty-free, irrevocable, and perpetual license for the Actual System intellectual property to ASA Holdings, as well as a ten-year license to the Hollander Interchange, an auto parts database that Hollander maintains and licenses to third parties. If Solera does not divest the assets within 120 days of the order becoming final, the FTC may appoint a trustee to oversee the sale of the assets.

Companies: Solera Holdings, Inc.; Actual Systems of America, Inc.; ASA Holdings, Inc.

News: Antitrust FederalTradeCommissionNews