CELEX: 31996M0721
Language: en
Date: 1996-03-20 00:00:00
Title: COMMISSION DECISION of 20/03/1996 declaring a concentration to be compatible with the common market (Case No IV/M.721 - Textron / Valois) according to Council Regulation (EEC) No 4064/89 (Only the English text is authentic)

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31996M0721

COMMISSION DECISION of 20/03/1996 declaring a concentration to be compatible with the common market (Case No IV/M.721 - Textron / Valois) according to Council Regulation (EEC) No 4064/89 (Only the English text is authentic)  

Official Journal C 186 , 26/06/1996 P. 0002

  COMMISSION DECISION of 20/03/1996 declaring a concentration  to be compatible with the common market (Case No IV/M.721 -  Textron / Valois) 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.721  Textron/Valois  <ind> Notification of 19 February 1996 pursuant to Article 4  of Council Regulation No. 4064/89  1.<ind> On 19 February 1996, the Commission received a  notification of a proposed concentration pursuant to Article  4 of a Council Regulation (EC) No. 4064/89 by which Textron  Inc. acquires within the meaning of Article 3(1)b of the  Council Regulation control of the whole of Valois Industries  S.A. by way of purchase of shares.  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> <ind> for Textron : manufacture of aircraft,  automotive components, aerospace and defence components;  <ind> <ind> for Valois Industries : design and manufacture  of fastenings and components for the automotive and other  industries.  II.<ind> COMMUNITY DIMENSION  4.<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 markets  5.<ind> The businesses being acquired include the  manufacture and sale of automotive fasteners which are  activities in which both Textron and Valois participate.   There are a variety of different types of automotive  fasteners manufactured for different purposes. The parties  also produce fasteners for nonautomotive uses, but there is  no overlap between the parties' operations in terms of end  users. It is unnecessary further to delineate the relevant  product markets because even using the narrowest product  market definition there is no significant impact impeding  competition in the EEA area.  <ind> B. Relevant geographic markets  6.<ind> The relevant geographic market appears to be at  least EEA wide when supplies of a new component are being  sought.  This is partly because car manufacturers are  increasingly sourcing their requirements on a global basis.  However, that market may narrow once a small number of  suppliers have been selected by the car manufacturer to be  suppliers of that component and also because transport costs  can account for a relatively high proportion of the total  costs of some fasteners.  However, it is not necessary  further to delineate the relevant geographic markets because  even in the narrowest geographic market there is not a  significant impact impeding competition in the EEA area or  any substantial part of it.  <ind> C. Assessment   7.<ind> According to the information provided by the  notifying parties, in the European Union, Valois has a  market share of [1015%] [Business secret] in 1995 whilst  Textron had a market share of [below 5%].  the only country  in which there was a significant overlap is Germany (Valois  [below 15%], Textron [below 10%]).  The combined market  share total of [below 25%] represents the highestwhich will  exist in any individual country in the EU.  There are a  large number of competitors on the market, a fact which was  confirmed by the parties' customers.  8.<ind> In view of the market position of Textron and  Valois, the presence of several other important suppliers,  and the considerable bargaining power of customers  (including the car manufacturers and second tier parts  manufacturers) it appears that the notified operation will  have a minimal impact on competition in the European Union.  IV.<ind> ANCILLARY RESTRAINTS  9.<ind> The parties have asked for four provisions of the  sale and purchase agreement to be declared ancillary to the  concentration.  Two of these provisions only cover the  period up until the closing date of the transaction which  inter alia confer certain exclusive negotiating rights for  Textron and restrict Valois from making material changes to  the business during this period. These restrictions do not  amount to a restriction of competition.  10.<ind> The third provision imposes a confidentiality  obligation on the seller in respect of Valois Industries  following the transaction.  The final one is a noncompete  clause which prevents the seller from competing with, or  soliciting employees from, or interfering with the business  relationships (eg reducing the goodwill of the company  following the sale) of Valois for [Business secret] years  from the date of the transaction. Both of these provisions  are directly related and necessary for the implementation of  the concentration and can be declared ancillary to the  transaction.  V.<ind> CONCLUSION  11.<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.  <tab> <tab> <tab> For the Commission,