CELEX: 31996M0717
Language: en
Date: 1996-03-25 00:00:00
Title: COMMISSION DECISION of 25/03/1996 declaring a concentration to be compatible with the common market (Case No IV/M.717 - Viacom / Bear Stearns) according to Council Regulation (EEC) No 4064/89 (Only the English text is authentic)

Avis juridique important

|

31996M0717

COMMISSION DECISION of 25/03/1996 declaring a concentration to be compatible with the common market (Case No IV/M.717 - Viacom / Bear Stearns) according to Council Regulation (EEC) No 4064/89 (Only the English text is authentic)  

Official Journal C 132 , 04/05/1996 P. 0003

 COMMISSION  DECISION of 25/03/1996 declaring a concentration to be compatible with the common market (Case No IV/M.717  - Viacom / Bear Stearns) 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.717  Viacom/Bear Stearns <ind> <ind> Notification of 22.02.1996 pursuant to Article 4 of Council Regulation No 4064/89 1.<ind>  On 22 February 1996 Viacom Inc.("Viacom")  and  The Bear  Stearns Companies ("Bear Stearns") notified a proposed concentration   by  which  the  two  companies   Nickelodeon (Deutschland) GmbH & CO KG  ("Nickelodeon") and VH1  GmbH  & CO OHG ("VH1"), which companies are presently under the sole control  of Viacom, are to be jointly controlled  by  Viacom and  Bear Stearns. Thus, the concentration is a passage from sole control to joint control of Nickelodeon and VH1. 2.<ind>   After   examination  of  the   notification,   the Commission  has concluded that the notified operation  falls within  the scope 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' ACTIVITIES AND THE OPERATION 3.<ind>   The   business  activities  of  the   undertakings concerned are: <ind>  Viacom is a diversified entertainment and  publishing company  with operations in five segments: (1) networks  and broadcasting,  (2) entertainment, (3) video and  music/theme parks, (4) publishing, and (5) cable television. <ind>  Bear  Stearns is a leading United  States  investment banking, securities trading and brokerage firm. <ind> Nickelodeon and VH1 are two Germany based companies in the business of German language TV broadcasting to cable and directtohome  viewers in Germany, Austria and Germanspeaking areas of Switzerland. 4.<ind>  The  proposed concentration results in  Viacom  and Bear  Stearns  taking joint control of two businesses,  i.e. Nickelodeon and VH1, which companies previously  were  under sole  control of Viacom. Joint control over Nickelodeon  and VH1  is  conferred  upon the parties via a  special  purpose holding  company,  Viacom Holdings (Germany)  B.V.  ("Viacom Holdings") which company controls Nickelodeon and VH1.  5.<ind>  Under  the  terms  of the  shareholders'  agreement entered  into  by  Viacom and Bear Stearns, Viacom  Holdings shall  have [Deleted  business secret] . Among the decisions that  shall require the approval and signature of  not  less than [Deleted  business secret (total including at least one appointee of the parent companies)] are the approval of  the Annual  Business Plan of the company and the appointment  or replacement   of  any  senior  managers  of   the   company. Consequently,   Viacom  and Bear  Stearns  will  have  joint control of the joint venture. 6<ind> The joint venture is an existing company with all the assets  and resources necessary to enable it to perform  all the  functions  of an autonomous economic entity,  including the  necessary  broadcast licenses and  transponder  leases. Furthermore,  since  Bear Stearns is  not  involved  in  the markets  of the joint venture or in markets related  to  the joint  venture  the creation of the joint venture  will  not give  rise  to  coordination  of the  competitive  behaviour between  Viacom and Bear Stearns  or between  them  and  the joint venture. II.<ind> COMMUNITY DIMENSION 7.<ind> The undertakings concerned have a combined aggregate worldwide  turnover  in excess of 5,000  million  ECU.  Each party  has a Communitywide turnover in excess of 250 million ECU,  but  do  not  achieve  more than  twothirds  of  their aggregate  Communitywide turnover within one  and  the  same Member  State.  The  notified  operation  therefore  has   a Community  dimension, but does not constitute a  cooperation case under the EEA Agreement. III.<ind> COMPATIBILITY WITH THE COMMON MARKET <ind> A. Relevant product and geographic markets 8.<ind>  Only  Viacom contributes businesses  to  the  joint venture,  that  is  German language, advertisersupported  TV broadcasting to cable and directtohome viewers  in  Germany, Austria and Germanspeaking areas of Switzerland. There is no overlap  in this business  since even in the widest possible definition  of  the  product markets  Bear  Stearns  is  not involved   in  businesses  related  to  the  joint  venture. Therefore,  it  is  not  necessary to  define  the  relevant product and geographic markets. <ind> B. Assessment 9.<ind>  There  is  no affected market as  Viacom  and  Bear Stearns  are not engaged in business activities in the  same product market, or in a product market which is upstream  or downstream  of a product market in which either of  them  is active.  Accordingly,  no addition  of  market  shares  will result from the concentration. IV.<ind> ANCILLARY RESTRICTIONS 10.<ind> The parties have notified as ancillary restrictions Articles   5.2.A,  5.2.C,  5.3.A,  7.1  and   7.2   of   the Shareholders Agreement.  11.<ind>  Article  7.1  is intended  to  avoid  a  situation whereby one of the partners would be obliged to accept a new partner  in the joint venture through a share transfer.  The Article  provides  [Deleted  business secret]  12.<ind>  Articles  5.2.A and 5.3.A  provide  that  [Deleted business  secret  (limitation to voting rights  intended  to preserve the full effect of Article 7.1.)] 13.<ind> Article 5.2.C provides that Bear Stearns shall  not acquire,   directly  or  indirectly,  more   than   [Deleted business  secret (limitation to acquisition  into  competing businesses)]  14.<ind> In so far as the above mentioned provisions can  be considered  as  restrictive  to  competition  they  aim   at expressing  the  reality of the lasting  withdrawal  of  the parents  from  the market assigned to the joint  venture  or they protect the legitimate interest of the parent companies in the identity of their partner in the joint venture. Thus, these provisions can be recognized as integral parts of  the operation and hence ancillary.  V.<ind> CONCLUSION 15.<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,