CELEX: 31995M0593
Language: en
Date: 1995-06-27 00:00:00
Title: COMMISSION DECISION of 27/06/1995 declaring a concentration to be compatible with the common market (Case No IV/M.593 - VOLVO / HENLYS) according to Council Regulation (EEC) No 4064/89 (Only the English text is authentic)

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31995M0593

COMMISSION DECISION of 27/06/1995 declaring a concentration to be compatible with the common market (Case No IV/M.593 - VOLVO / HENLYS) according to Council Regulation (EEC) No 4064/89 (Only the English text is authentic)  

Official Journal C 177 , 12/07/1995 P. 0007

  COMMISSION DECISION of 27/06/1995 declaring a concentration  to be compatible with the common market (Case No IV/M.593 -  VOLVO / HENLYS) according to Council Regulation (EEC) No  4064/89   (Only the English text is authentic).   The paper version of the decision is available through the  sales offices of the Office of Official Publications of the  European Communities  PUBLIC VERSION  MERGER PROCEDURE  ARTICLE 6(1)(b) DECISION  To the notifying parties  Dear Sirs,  Subject :<ind> Case No IV/M.593  Volvo/Henlys  <ind> <ind> Notification of 04.05.1995 pursuant to Article 4  of Council Regulation No 4064/89  1.<ind> On 19.5.1995 Volvo Bus Corporation (VBC), belonging  to the Volvo Group, and Henlys Group plc. (HG) a company  incorporated in England, notified an operation whereby they  will acquire joint control of the Canadian company, Prévost  Car Inc. (PC).  2.<ind> After examination of the notification, the  Commission has concluded that the notified operation falls  within the scope of application of Council Regulation No.  4064/89 and does not raise serious doubts as to its  compatibility with the common market and with the  functioning of the EEA Agreement.  I.<ind> THE PARTIES  3.<ind> VBC is the company within the Volvo Group that  designs, manufactures and markets both the chassis for buses  and coaches and buses and coaches. While mainly a chassis  producer, it runs bodybuilding operations in Sweden, Austria  and France.  4.<ind> HG designs and manufactures bodies for coaches and  buses and also sells coaches and buses. Its activities are  confined to the U.K., with the exception of the export of a  small number of coaches to France.  5.<ind> PC manufactures and sells intercity coaches and  luxury bus shells (for conversion into luxury motor homes,  special purpose vehicles, etc.) in the U.S. and Canadian  markets.  II.<ind> THE OPERATION  6.<ind> The notified operation will be the second of two  transactions aimed at bringing about the concentration. The  first transaction, which is not notifiable, will consist of  the acquisition by VBC of 100% of the shares in PC.  Subsequently, VBC will set up a new, Dutch or Canadian,  holding company which will in turn hold all of the acquired  shares. The second, and presently notified, transaction will  consist of the creation of a joint venture through the  subscription by both VBC and HG, to 51% and 49%  respectively, of the shares in the said holding company,  which will be under their joint control.   III.<ind> CONCENTRATION  (a)<ind> Joint control  7.<ind> VBC and HG are each entitled to nominate three  directors to the Board of PC. The Shareholders' Agreement  contains a clause to the effect that the unanimous written  consent of the directors is required for any of a number of  operations to be carried out by PC. In particular, unless  such unanimous consent is obtained "the Annual Budget shall  not be approved and no material change shall be made to such  Budget once approved". Hence PC will be jointly controlled  by VBC and HG.  (b)<ind> Concentration  8.<ind> PC's activities will continue to be focused entirely  upon the North American market for coaches and buses. North  American and EEA markets for coaches and buses are separate  (see below).  9.<ind> HG has no presence on the coach and bus market in  North America outside its investment in Prévost Car Inc.  Likewise, VBC is currently not a participant in the  manufacture, distribution or sale of coaches or buses in  North America. VBC used to have a manufacturing facility for  buses in Virginia (US), but this plant was closed in the  middle of the 1980s. Given the separate nature of the North  American markets for coaches and buses from those existing  in the EEA, the parties' joint control of PC cannot be  expected to give rise to any coordination of their  competitive behaviour withinthe EEA.  10.<ind> The extent of competition between HG and VBC in EEA  markets is in any event of a limited nature. VBC has no  coach or bus body building presence in HG's primary market,  the UK. VBC is a producer of coach and bus chassis and  engines (a market upstream of Henlys) and otherwise  undertakes coach and bus body building in Scandinavia,  Germany, Austria and France. The only one of these  territories in which the parties overlap is France, where HG  has a very modest presence in the coach sector of the  market.  11.<ind> PC possesses all the resources necessary to conduct  its business activities on a lasting basis (in terms, inter  alia, of staff, premises, goodwill, financing and revenues).  It has three plants located in Canada and an established  direct sales and marketing network in both Canada and the  US. The implementation of the proposed transaction will not  change the selfsufficiency of PC. PC's main suppliers are  all North American, and it is not intended that their  suppliers shall be replaced to any significant extent by VBC  or HG over the coming years.  12.<ind> In view of the above, PC will constitute a  concentrative, fullfunction, autonomous joint venture in the  terms of the Merger Regulation.  IV.<ind> COMMUNITY DIMENSION  13.<ind> The combined aggregate worldwide turnover of the  undertakings concerned is more than 5,000 MECU. Both VBC and  HG each have a Communitywide turnover of more than 250 MECU,  but do not achieve more than twothirds of this turnover in  one and the same Member State. Therefore the concentration  has a Community dimension.  V.<ind> COMPATIBILITY  14.<ind> North American and EEA markets for coaches and  buses are separate. There have been very few exports from  the EEA to North America. In order to be able to make any  exports, European manufacturers are required to make  substantial changes to their products to meet the required  North American specifications. There have to date been  virtually no imports of buses or coaches from North America  to the EEA (a very small number of US buses was imported  into the UK in 1994 under the Bluebird mark). The market  share is not measurable and it is unclear what further  imports will take place. The primary reasons for this are  differing technical and performance specifications required  by EEA coach and bus customers and the existence of  established indigenous suppliers in EEA markets.  15.<ind> In view of this, PC, which is not currently active  in EEA markets, is unlikely to be so in the future, and the  current operation will not result in any increment of the  EEA market share of either VBC or HG.  VI.<ind> CONCLUSION  16.<ind> In view of the above, the proposed concentration  does not raise serious doubts as to its compatibility with  the Common Market.  <ind> For the above reasons, the Commission has decided not  to oppose the notified operation and to declare it  compatible with the common market and with the functioning  of the EEA Agreement. This decision is adopted in  application of Article 6(1)(b) of Council Regulation No  4064/89.  For the Commission