CELEX: 32018M8837
Language: en
Date: 2018-07-20 00:00:00
Title: Commission Decision of 20/07/2018 declaring a concentration to be compatible with the common market (Case No COMP/M.8837 - Blackstone / Thomson Reuters Financial & Risk Business) according to Council Regulation (EC) No 139/2004 (Only the English text is authentic)

EUROPEAN COMMISSION
                                                                Brussels, 20.7.2018
                                                                C(2018) 4953 final
In the published version of this decision, some
information has been omitted pursuant to Article                     PUBLIC VERSION
17(2) of Council Regulation (EC) No 139/2004
concerning non-disclosure of business secrets and
other confidential information. The omissions are
shown thus […]. Where possible the information
omitted has been replaced by ranges of figures or a
general description.
                                                                To the notifying party:
Subject:            Case M.8837 - Blackstone / Thomson Reuters Financial and Risk
                    Business
                    Commission decision pursuant to Article 6(1)(b) of Council
                    Regulation No 139/20041 and Article 57 of the Agreement on the
                    European Economic Area2
Dear Sir or Madam,
(1)       On 15 June 2018, the European Commission received notification of a proposed
          concentration pursuant to Article 4 of the Merger Regulation by which The
          Blackstone Group ("Blackstone") will acquire within the meaning of Article
          3(1)(b) of the Merger Regulation sole control over Thomson Reuters Financial
          and Risk Business ("Thomson Reuters F&R" or "the Target") (the
          "Transaction")3. Blackstone is referred to as "the Notifying Party" and Blackstone
          and the Target together as "the Parties".
1.        THE PARTIES
(2)       Blackstone is a global asset manager and provider of financial advisory services,
          headquartered in the US.
(3)       The Target is a data and financial technology platform that provides information
          and data analytics, enables financial transactions, and connects communities of
1    OJ L 24, 29.1.2004, p. 1 (the 'Merger Regulation'). With effect from 1 December 2009, the Treaty on
     the Functioning of the European Union ('TFEU') has introduced certain changes, such as the
     replacement of 'Community' by 'Union' and 'common market' by 'internal market'. The terminology of
     the TFEU will be used throughout this decision.
2    OJ L 1, 3.1.1994, p. 3 (the 'EEA Agreement').
3    Publication in the Official Journal of the European Union No C 228, 29.06.2018, p. 33.
Commission européenne, DG COMP MERGER REGISTRY, 1049 Bruxelles, BELGIQUE
Europese Commissie, DG COMP MERGER REGISTRY, 1049 Brussel, BELGIË
Tel: +32 229-91111. Fax: +32 229-64301. E-mail: COMP-MERGER-REGISTRY@ec.europa.eu.
 ---pagebreak---          trading, investment, financial, corporate, strategy, treasure and risk professionals.
         It also provides regulatory and risk management solutions to help customers
         anticipate and manage risk and compliance.
2.       THE OPERATION
(4)      For the purpose of the Transaction, private equity funds controlled by Blackstone
         have formed King (Cayman) Holdings Ltd. ("HoldCo"). Canada Pension Plan
         Investment Board ("CPPIB") and Suzuka Investment Pte Ltd., an affiliate of GIC
         Private Limited ("GIC") will invest alongside Blackstone for the Transaction.
         CPPIB and GIC are together referred to as the Co-investors. Blackstone, CPPIB
         and GIC are together referred to as the Consortium. The Consortium will acquire
         a 55% stake in the Target through ownership by the Equity Investor Vehicle4
         (formed pursuant to Sections 2, 3 and 21 of the Equity Funding Arrangement
         Letters of the Transaction) of 55% of the common shares of HoldCo. Post-
         Transaction, Thomson Reuters will retain a 45% interest in the Target through
         ownership of 45% of the common shares of HoldCo. HoldCo will acquire all of
         the Target's assets.
(5)      Blackstone will solely control the Target within the meaning of Article 3(1)(b) of
         the EU Merger Regulation.
3.       EU DIMENSION
(6)      The undertakings concerned have a combined aggregate world-wide turnover of
         more than EUR 5 000 million5 (Blackstone [Confidential] in 2016 and the Target
         [Confidential] in 2017). Each of them has an EU-wide turnover in excess of EUR
         250 million (Blackstone [Confidential] in 2016 and the Target [Confidential] in
         2017), but they do not achieve more than two-thirds of their aggregate EU-wide
         turnover within one and the same Member State. The notified operation therefore
         has an EU dimension.
4.       COMPETITIVE ASSESSMENT
(7)      The Target provides a broad range of financial information products to financial
         market professionals, including real-time and non-real-time data services.
(8)      Blackstone is active in the same markets as the Target only via Ipreo LLC
         ("Ipreo"), a portfolio company it controls jointly together with the Goldman Sachs
         group Inc. Ipreo provides software, data and market intelligence products to
         companies that are active in capital markets. Ipreo's and the Target's activities
         give rise to horizontal overlaps.6
4   [Confidential]. Neither CPPIB nor GIC will obtain any rights in the Target which rise to the level of
    control as defined by the Merger Regulation.
5   Turnover calculated in accordance with Article 5 of the Merger Regulation.
6   In May 2018, Blackstone agreed to sell Ipreo to IHS Markit Ltd. This transaction is expected to close
    in the second half of 2018, effectively removing all horizontal overlaps between the Parties. However,
    by the time the Commission had to adopt a decision on the Transaction, the IHS Markit/Ipreo deal was
                                                         2
 ---pagebreak--- (9)      The Transaction also gives rise to limited vertical overlaps between the activities
         of Target and Blackstone (and its controlled portfolio companies).
  4.1. Relevant Markets
4.1.1. Discrete Content Sets, Desktop Services, and Non-Real Time Data Feeds
4.1.1.1. Introduction
(10)     The Transaction relates to the financial information industry, namely, the
         provision of financial information, analytics, and trading capabilities. According
         to the Notifying Party, the main users of the Parties' products are customers in the
         financial service industry, such as banks, traders, funds, and corporate customers.
(11)     Financial information can be categorized in real-time and non-real time market
         data. Real-time data consists of indicative or tradable prices for various types of
         financial instruments such as equities, corporate and government bonds, currency
         and traded commodities. Real-time data changes rapidly during the day and it is
         updated every millisecond. It is required by security dealers, foreign exchange
         dealers, and investment advisers for immediate consumption. Non-real time data
         is more general financial or economic information which may vary between days
         and parts of a day, but not every second. It does not satisfy real-time demands
         and is primarily adapted to research and customer awareness demands.
(12)     In the financial information business, there are different methods for the supply of
         financial information products to customers:
          a) Financial information can be delivered by suppliers to customers as
               "datafeeds" through an application programming interface (API), where the
               customers obtain their content in a direct or "raw" data format, from which
               they build their own internal applications or portals; and
          b) Financial information can also be integrated into "desktop solutions", namely,
               retail products, which contain a "front-end" window that enables the user to
               access the content and functionalities contained in the product on the screen.
               Such front-end windows can take the form of either a web-delivered solution
               or a deployed/physical solution.7
(13)     According to the Notifying Party, the vast majority of suppliers, including the
         Target, supply their content using both methods (directly to end-users as a
         datafeed and as a desktop solution).
4.1.1.2. Relevant Product Market
(14)     In Thomson/Reuters, the Commission's market investigation indicated that for
         financial information "discrete content sets represent the appropriate antitrust
     not completed. For the purposes of the competitive assessment of the Transaction, Ipreo is considered
     as part of Blackstone.
7    M.4726, Thomson Corporation / Reuters Group, paras. 25-28.
                                                        3
 ---pagebreak---       markets for assessing the impact" of the transaction that was under review.8 The
      investigation in that case suggested that the value of the products in the financial
      information business lies in their functionalities and content.9 The majority of
      both customers and competitors considered in that case that "individual content
      sets are not substitutable for one another".10 The Commission therefore
      identified separate relevant markets for each type of data content sets.11
      Regarding non-real time content, the Commission identified separate markets for
      fundamentals content sets, deals content sets, ownership content sets, and other
      types of content.12 The Commission clarified that each of the discrete content sets
      may be sold/delivered in various modalities: as standalone products (e.g., as
      databases or datafeeds) or as part of a desktop service.13
(15)  In the present case, the Notifying Party disagrees with the market delineation in
      Thomson/Reuters. It submits that relevant markets for financial information
      products should not be sub-segmented based on discrete content sets because the
      competitive landscape and the market dynamics have continued to evolve
      significantly in the 10 years since the Thomson/Reuters decision. According to
      the Notifying Party, financial information suppliers (including the Target) moved
      towards packaged solutions (desktop services and datafeeds). For such packaged
      solutions, competition takes place at the level of the comprehensive packaged
      desktop or datafeed rather than at the level of discrete content sets or
      functionalities.
(16)  In light of the above, the Notifying Party proposed relevant product markets for
      (i) desktop services, (ii) non-real-time datafeed services and (iii) real-time
      datafeed services. However, for the purpose of this transaction real-time datafeed
      services are not a relevant market as the Parties activities do not overlap for real-
      time datafeed services:
      a) Desktop services. Desktop services include comprehensive integrated
           desktops, more narrowly focused integrated desktops (a.k.a., workstations or
           terminals) and content/functionality sold for individual use which can be
           incorporated or used in/alongside an integrated desktop. The Notifying Party
           submitted that financial information suppliers typically provide desktop
           services that comprise multiple sources of different types of financial data.
           According to the Notifying Party, the various content sets and functionalities
           in these solutions are not priced separately and cannot be accessed outside of
           the comprehensive packaged desktop product.
8  M.4726, Thomson Corporation / Reuters Group, para. 43.
9  M.4726, Thomson Corporation / Reuters Group, para. 43.
10 M.4726, Thomson Corporation / Reuters Group, paras. 44-46.
11 M.4726, Thomson Corporation / Reuters Group, para. 61ff.
12 M.4726, Thomson Corporation / Reuters Group, paras. 74ff., in particular, 82ff., 88, and 89.
13 M.4726, Thomson Corporation / Reuters Group, para. 50.
                                                   4
 ---pagebreak---         b) Non-real time datafeeds. Non-real time datafeeds combine various types of
             general financial or economic (historical or archival) information. According
             to the Notifying Party, non-real time datafeeds do not belong in the same
             market as real time datafeeds. The characteristics of the two types of
             datafeeds are very different. For real time datafeeds, timeliness is the most
             important feature, while for non-real time datafeeds the focus is on
             completeness and reliability of the information. Real-time datafeeds and non-
             real time datafeeds also address different types of demand as explained in
             Section 4.1.1.1 above. The Commission has confirmed in its decisional
             practice that real time datafeeds belong to relevant markets separate from non-
             real time datafeeds.14
(17)    The market investigation did not support the view of the Notifying Party that
        customers typically only purchase financial information as part of packaged
        solutions. The vast majority of customers stated that they continue to buy
        financial information in the form of discrete content sets and not only in packaged
        solutions.15 All of the respondents confirmed that when purchasing financial
        information, they compare the offering of discrete content sets and packaged
        solutions.16 Many respondents admitted that packaged solutions lead to cost
        savings and allow users to be more efficient.17 But customers also highlighted
        that they sometimes need to source discrete content sets from different suppliers,
        for example "to obtain the maximum data coverage and in order to ensure data
        comparisons for data quality processes" or "if a packaged solution does not
        contain the data [the customer] need[s]".18
(18)    In any event, for the purposes of the present case, the exact market definition can
        be left open, as no serious doubts arise under any plausible product market
        definition (discrete content sets or packaged solutions).
4.1.1.3. Relevant Geographic Market
(19)    The Notifying Party submitted that the relevant geographic scope for desktop
        services is worldwide or at least EEA-wide as both customers and competitors are
        active globally or at least regionally and the core offering remains the same
        throughout the world and/or the region. The market investigation confirmed
        this.19
(20)    The Notifying Party submitted that the relevant geographic scope for non-real-
        time datafeeds is worldwide or at least EEA-wide. The market investigation did
        not bring any element to the Commission's attention which would suggest that the
        market is narrower than EEA-wide.
14 See AT.39654 – Reuters Instrument Codes, para. 29 and M.4726, Thomson Corporation / Reuters
    Group, paras. 65ff. which define markets for consolidated real-time datafeeds and direct real-time
    datafeeds.
15 See Questionnaire Q1 – Customers, Q3 and Q10.
16 See Questionnaire Q1 – Customers, Q3.4.
17 See Questionnaire Q1 – Customers, Q3.2.
18 See Questionnaire Q1 – Customers, Q3.1.
19 See Questionnaire Q1 – Customers, Q8.1.
                                                    5
 ---pagebreak--- (21)    The Notifying Party recalled that in Thomson/Reuters, the Commission
        considered that the relevant geographic scope for discrete content sets was EEA-
        wide or potentially global in scope. The market investigation in the present case
        confirmed this.20
(22)    In any event, for the purposes of the present case, the exact market definition can
        be left open, as no serious doubts arise under any plausible geographic market
        definition (EEA-wide or worldwide).
4.1.2. Consolidated Real Time Datafeeds
(23)    A real time datafeed is a virtual pipeline that supplies continually updated market
        information. Real-time data feeds can be used in applications developed by banks
        and financial institutions, for example to allow for electronic or algorithmic
        trading.21 There are two types of real time datafeeds: consolidated and direct.
        Consolidated real time datafeeds involve the aggregation of feeds from various
        sources into a single source. Direct real time datafeeds involve a more direct
        connection from an individual exchange to a customer.22 In Reuters Instrument
        Codes, the Commission found that consolidated real time datafeeds and direct real
        time datafeeds belong to different product markets.23 The Notifying Party
        submits that it is not necessary to define conclusively the relevant product market.
(24)    In Reuters Instrument Codes, the Commission defined the market for
        consolidated real time datafeeds as worldwide.24 The Notifying Party submits
        that it is not necessary to define conclusively the relevant geographic market.
(25)    For the purposes of the present case, the Commission considers that there is a
        separate relevant market for consolidated real time datafeeds, which is worldwide
        in scope.
4.1.3. Market Data Platform Services
(26)    Market data platform services ("MDPs") are "middleware" that receive datafeeds
        from multiple sources (including real time datafeeds and other sources) as inputs
        and distribute this information to terminals, applications, wireless devices and the
        internet.25, In its decisional practice, the Commission defined a separate market
        for MDPs.26 The Notifying Party submits that for the purpose of the present case
        it is not necessary to define conclusively the relevant product market.
(27)    In previous decisions, the Commission has considered the geographic market for
        MDP to be at least EEA-wide or worldwide, but left the geographic scope open.27
20  See Questionnaire Q1 – Customers, Q14.
21  AT.39654, Reuters Instrument Codes, para. 24.
22  M.4726, Thomson Corporation / Reuters Group, para. 66.
23  M.4726, Thomson Corporation / Reuters Group, para. 29.
24  AT.39654, Reuters Instrument Codes, para. 31.
25  M.4726, Thomson Corporation / Reuters Group, para. 68.
26  M.4726, Thomson Corporation / Reuters Group, paras. 62 and 69 and M.3692, Reuters/Telerate, para.
    13.
27 M.3692, Reuters/Telerate, para 16 and M.4726, Thomson Corporation / Reuters Group, para 111.
                                                    6
 ---pagebreak---        The Notifying Party submits that for the purpose of the present case it is not
       necessary to define conclusively the relevant geographic market.
(28)   For the purposes of the present case, the Commission considers that there is a
       separate relevant product market for MDPs. The exact geographic scope of the
       market can be left open, as no serious doubts arise under an EEA-wide or a
       worldwide market definition.
4.1.4. Life Insurance
(29)   In its decisional practice, the Commission has made a distinction between three
       broad categories of insurance products, namely (i) life insurance; (ii) non-life
       insurance; and (iii) reinsurance. With respect to the life insurance market, the
       Commission has distinguished between (i) pure protection products; (ii) pension
       products; and (iii) investment products, but also considered pension and
       investment products together as part of the same product market.28 Additionally,
       the Commission has considered distinguishing between life insurance for
       individuals and group customers, or between products based on the type of risk
       covered. Ultimately, the product market definition has been left open. 29 The
       Notifying Party submits that for the purpose of the present case it is not necessary
       to define conclusively the relevant product market.
(30)   In previous cases, the Commission considered that the market for Life Insurance
       is national.30 The Notifying Party submits that for the purpose of the present case
       it is not necessary to define conclusively the relevant geographic market.
(31)   In any event, for the purposes of the present case, the exact market definition can
       be left open, as no serious doubts arise under any plausible product or geographic
       market definition.
4.1.5. Bulk Annuity Insurance Transactions
(32)   Bulk annuity insurance transactions are de-risking transactions that are common
       in the insurance business, especially in relation to Defined Benefit pension
       schemes. In a bulk annuity insurance transaction, all of the risk associated with
       the pension liabilities is transferred to a third party. In its decisional practice, the
       Commission considered that a separate market exists for bulk annuity insurance
       transactions.31 The Commission has also considered a further distinction in the
       bulk annuity insurance transactions market between buy-in and buy-out
       transactions, but ultimately left the product market open32. The Notifying Party
       submits that for the purpose of the present case it is not necessary to define
       conclusively the relevant product market.
28 M.5075, Vienna Insurance Group / EBV; M.5728, Crédit Agricole / Société Générale Asset
    Management; M.5384, BNP Paribas / Fortis.
29 M.6883, Canada Life / Irish Life, M.6521, Talanx International / Meiji Yasuda Life Insurance / Warta,
    M.4701, Generali / PPF Insurance Business, M.4047, Aviva / Ark Life, M.1453 AXA / GRE.
30 M.6521, Talanx International / Meiji Yasuda Life Insurance / Warta; M.5075, Vienna Insurance
    Group / EBV and M.5057, Aviva / UBI Vita, M.6883, Canada Life/ Irish Life
31 M.8257, NN Group / Delta Lloyd, para 88; M.7204, Rothesay Life / Metlife Assurance.
32 M.8257, NN Group / Delta Lloyd, para 88
                                                      7
 ---pagebreak--- (33)   In previous cases, the Commission considered that the market for bulk annuity
       contracts is national in scope.33 The Notifying Party submits that for the purpose
       of the present case it is not necessary to define conclusively the relevant
       geographic market.
(34)   In any event, for the purposes of the present case, the exact market definition can
       be left open, as no serious doubts arise under any plausible product or geographic
       market definition.
4.1.6. Asset management
(35)   In its decisional practice, the Commission described asset management as the
       provision and potential implementation of investment advice.34 It also considered
       that asset management may include the creation and managing of mutual funds
       which are then marketed on an “off-the-shelf” basis, including to retail customers,
       the provision of portfolio management services to institutional investors (pension
       funds, institutions and international organisations), and the provision of custody
       services related to asset management. The Commission also considered the
       possibility of there being a relevant product market for asset management, which
       would include the creation and management of mutual funds for retail clients and
       tailor-made funds for corporate and institutional customers, and portfolio
       management for private investors, pension funds and institutions.35 The
       Commission further considered the possible existence of separate relevant
       product markets for each of the types of products mentioned above, 36 but
       ultimately left the product market open. The Notifying Party submits that for the
       purpose of the present case it is not necessary to define conclusively the relevant
       product market.
(36)   In previous cases, the Commission considered that the market for asset
       management is national or EEA-wide in scope.37 The Notifying Party submits
       that for the purpose of the present case it is not necessary to define conclusively
       the relevant geographic market.
(37)   In any event, for the purposes of the present case, the exact market definition can
       be left open, as no serious doubts arise under any plausible product or geographic
       market definition.
4.1.7. Investment banking
(38)   Investment banking includes services such as advice on the financial aspects of
       mergers and acquisitions, initial public offerings and arranging new issues of
       stocks and bonds, excluding the underwriting of such operations. In its decisional
       practice, the Commission analysed the market for investment banking as a whole,
       while identifying the following possible market segments: (i) merger and
       acquisition advice; (ii) capital markets business such as Initial Public Offering
       and share issues advice; and (iii) Services relating to arranging new issues as
33  M.8257, NN Group/Delta Lloyd, para. 91 and M.7204, Rothesay Life / Metlife Assurance, para. 28.
34  M.8257, NN Group / Delta Lloyd, para. 108.
35  M.6812, SFPI / Dexia, M.3894 Unicredito/HVB, M.8257, NN Group / Delta Lloyd.
36  M.8257, NN Group/Delta Lloyd, para. 110.
37  M.8257, NN Group / Delta Lloyd, para. 110.
                                                    8
 ---pagebreak---         stocks and bonds.38 The Commission ultimately left the product market open.
        The Notifying Party submits that for the purpose of the present case it is not
        necessary to define conclusively the relevant product market.
(39)    In previous cases, the Commission has considered the relevant geographic market
        to be national or international (EEA-wide or global), but ultimately left the
        geographic market open.39 The Notifying Party submits that for the purpose of
        the present case it is not necessary to define conclusively the relevant geographic
        market.
(40)    In any event, for the purposes of the present case, the exact market definition can
        be left open, as no serious doubts arise under any plausible product or geographic
        market definition.
4.1.8. Financial market services
(41)    Financial market services are provided to institutional investors, corporate clients,
        and professional traders who lack direct access to financial markets or otherwise
        value the intermediary services provided by a bank. In its decisional practice, the
        Commission distinguished within the market for financial market services
        between the following sub-segments: (i) trading in securities, bonds and
        derivatives, (ii) foreign exchange trading, (iii) money market operations and (iv)
        trading of other asset classes40, but ultimately left the product market open. The
        Notifying Party submits that for the purpose of the present case it is not necessary
        to define conclusively the relevant product market.
(42)    The Commission has considered the relevant geographic market to be national or
        wider (EEA or global)41, but ultimately left the geographic market open. The
        Notifying Party submits that for the purpose of the present case it is not necessary
        to define conclusively the relevant geographic market.
(43)    In any event, for the purposes of the present case, the exact market definition can
        be left open, as no serious doubts arise under any plausible product or geographic
        market definition.
4.1.9. Private equity investment
(44)    Private equity investment is the investment of equity in unquoted companies (i.e.,
        companies whose shares are not quoted on any public exchange). The supply of
        funds for equity investment can comprise equity and debt finance. In its
        decisional practice, the Commission considered a further distinction between the
        supply of debt and equity finance.42 The Commission has also considered private
        equity as a segment of the corporate finance market or asset management
38 M.5384, BNP Paribas / Fortis, M.6168, RBI / EFG EUROBANK / JV, M.4692, Barclays / ABN
    AMRO, M.3894, Unicredito / HVB.
39 M.5726, Deutsche Bank / SAL Oppenheim, M.5384, BNP Partibas / Fortis, M.7044, Blackstone /
    Goldman Sachs / Rothesay.
40 M.3894, Unicredito / HVB, M.4692, Barclays / ABN AMRO, M.5384, BNP Paribas / Fortis, M.5726,
    Deutsche Bank / SAL Oppenheim, and M.6168, RBI/EFG Eurobank / JV.
41 M.3894, Unicredito / HVB, M.4692, Barclays / ABN AMRO, M.5384, BNP Paribas / Fortis, M.5726,
    Deutsche Bank / SAL Oppenheim; and M.6168, RBI / EFG Eurobank / JV.
42 M.2577, GE Capital / Heller Financial.
                                                   9
 ---pagebreak---         services, but ultimately left the market definition open.43 The Notifying Party
        submits that for the purpose of the present case it is not necessary to define
        conclusively the relevant product market.
(45)    In previous decisions, the Commission considered the market for private equity
        investment could be considered either national or wider, but ultimately left the
        geographic market open.44 The Notifying Party submits that for the purpose of
        the present case it is not necessary to define conclusively the relevant geographic
        market.
(46)    In any event, for the purposes of the present case, the exact market definition can
        be left open, as no serious doubts arise under any plausible product or geographic
        market definition.
4.1.10. Mortgages
(47)    As described in recital (46), the Commission has in previous decisions
        distinguished three segments within the banking market, namely retail banking;
        corporate banking; and financial market services. The Commission also
        considered mortgages as a potential market sub-segment within the retail banking
        market. The exact product market definition has been left open.45 The Notifying
        Party submits that for the purpose of the present case it is not necessary to define
        conclusively the relevant product market.
(48)    In previous decisions, the Commission considered the market for retail banking
        services (including mortgages) to be national in scope, but ultimately left the
        market open.46 The Notifying Party submits that for the purpose of the present
        case it is not necessary to define conclusively the relevant geographic market.
(49)    In any event, for the purposes of the present case, the exact market definition can
        be left open, as no serious doubts arise under any plausible product or geographic
        market definition.
4.2.    Competitive Assessment
4.2.1. Horizontal Analysis
(50)    In the market segments that the Notifying Party proposed as horizontally
        overlapping (i.e., desktop services and non-real time data feeds), the Transaction
        does not give rise to affected markets worldwide or in the EEA. The combined
        entity would hold [10-20%] in desktop services in the EEA and [10-20%]
        worldwide and the share increment contributed by Ipreo would be minimal
        (below [0-5%]). The combined entity would have a share of [10-20%] in non-
        real-time data feeds in the EEA and [10-20%] worldwide and the share increment
        contributed by Ipreo would be minimal (below [0-5%]). In both the proposed
43 M.6738, Goldman Sachs / KKR / QMH, M.6832, Goldman Sachs / TPG Lundy / Ainscough, M.6841,
    Goldman Sachs / TPG Lundy / Tulloch Homes Group Limited.
44 M.2577, GE Capital / Heller Financial.
45 M.5384, BNP Paribas / Fortis, M.4844, Fortis / ABN Amro assets, M.8553, Banco Santander / Banco
    Popular, M.6405, Banco Santander / Rainbow.
46 M.5384 BNP Paribas / Fortis, M.4844 Fortis/ABN Amro assets, M.8553 Banco Santander/Banco
    Popular, M.6405 Banco Santander/Rainbow.
                                                    10
 ---pagebreak---  ---pagebreak--- 4.2.1.1. Deals Content Sets
(53)    In deals content sets, post-Transaction the Parties will have a combined market
        share of [20-30%] post-Transaction globally and in the EEA. The share
        increment contributed by Ipreo is less than [0-5%] (i.e., less than [0-5%] in the
        EEA and less than [0-5%] worldwide). The HHI increment is minimal. Post-
        Transaction, the combined entity will continue to face significant constraints from
        at least five players, i.e., Dealogic, Bloomberg, Acuris, S&P, and FactSet.
(54)    Moreover, according to the Parties, the Target and Ipreo are not close
        competitors. The Target is a "Tier 1"51 player in this space (alongside Dealogic)
        while Ipreo has very limited presence.
(55)    Finally, during the market investigation, the vast majority of market respondents
        did not identify any impact of this Transaction on competition in the market for
        deals content sets in the EEA or worldwide.52
(56)    In view of the above, the Commission concludes that no serious doubts as to the
        compatibility of the Transaction with the internal market arise for deals content
        sets in the EEA or worldwide.
4.2.1.2. Fundamentals Content Sets
(57)    In fundamental content sets, the Transaction gives rise to an affected market only
        at worldwide level (where the combined share of the Parties is [15-25%]). The
        market is not affected at EEA level. At global level, the share increment
        contributed by Ipreo is [0-5%]. The HHI increment is minimal. Post-
        Transaction, the combined entity will continue to face significant constraints from
        at least eleven competitors, including major players like Bloomberg, FactSet, and
        S&P Global, as well as other smaller rivals, such as Morningstar, Zacks, Edgar
        Online, Toyo Keizai, Fitch, Value Line, World'Vest Base, and Mergent.
(58)    Moreover, according to the Parties, the Target and Ipreo are not close
        competitors. The Target is a "Tier 1" player in this space while Ipreo has very
        limited presence. Ipreo does not collect or own its own fundamentals database. It
        is simply a re-distributor of FactSet fundamentals (and estimates) content.53
(59)    Finally, during the market investigation, the vast majority of market respondents
        did not identify any impact of this Transaction on competition in the market for
        fundamentals content sets worldwide.54
(60)    In view of the above, the Commission concludes that no serious doubts as to the
        compatibility of the Transaction with the internal market arise for fundamentals
        content sets worldwide.
51 Tier 1 suppliers offer broader and deeper coverage than Tier 2 suppliers for fundamental content sets.
    Examples of Tier 1 suppliers for fundamental content sets are Bloomberg, FactSet, S&P Global and
    The Target. Examples of Tier 2 suppliers are Morningstar, Zacks, Edgar Online, Toyo Keizai, Fitch,
    Value Line; World'Vest Base, Mergent and other smaller suppliers.
52 See Questionnaire Q1 – Customers, Q20.
53 See https://ipreo.com/targeting-services/.
54 See Questionnaire Q1 – Customers, Q18.
                                                     12
 ---pagebreak--- 4.2.1.3. Loans Content Sets
(61)    In loans content sets, the Transaction gives rise to an affected market only at
        EEA-wide level (where the combined share of the Parties is [10-20%]). The
        market is not affected at worldwide level. At EEA-wide level, the share
        increment contributed by Ipreo is [0-5%]. The HHI increment is minimal. Post-
        Transaction, the combined entity will continue to face significant constraints from
        at least five competitors, including major players like IHS Markit, S&P Global
        Market Intelligence (CapIQ), and Bloomberg and other rivals, such as Dealogic,
        Loan Radar, and Moody's (through its recent acquisition of Bureau Van Dijk).
(62)    Finally, during the market investigation, the vast majority of market respondents
        did not identify any impact of this Transaction on competition in the market for
        loans content sets in the EEA.55
(63)    In view of the above, the Commission concludes that no serious doubts as to the
        compatibility of the Transaction with the internal market arise for loans content
        sets in the EEA.
4.2.1.4. Ownership Content Sets
(64)    In ownership content sets, the Parties will have a combined market share of [20-
        30%] in the EEA and [20-30%] globally post-Transaction. The share increment
        contributed by Ipreo is [0-5%] or less. Post-Transaction, the combined entity will
        continue to face significant constraints from at least five players, i.e., FactSet,
        Bloomberg, S&P Global Market Intelligence (CapIQ), Morningstar, and
        Dealogic.
(65)    According to the Notifying Party, Ipreo's and the Targets products do not compete
        closely. The market investigation confirmed this. The majority of the respondents
        identified FactSet as the closest competitor to the Target, in terms of scope of the
        data offered, price, after-sales services, and integration possibilities.56 The
        respondents were also asked to rank seven providers of ownership content sets
        (Ipreo, the Target, FactSet, Bloomberg, CapIQ, MorningStar, and Dealogic) from
        strongest to weakest taking into account their sales in the EEA in 2017. The
        majority ranked the Target as the strongest or second strongest and Ipreo only as
        the weakest or second weakest.57 The Notifying Party added that Ipreo's and the
        Target's products do not compete closely because they are delivered to the
        customers through different channels. Ipreo provides its content either through a
        standalone web-based solution or via a customer relationship management
        ("CRM") system. In contrast, the Target is not active in the CRM space, but
        provides its ownership content either as part of its flagship comprehensive
        integrated desktop service (Eikon) or as a datafeed which is sold to clients and is
        then integrated into the client's proprietary software.
55 See Questionnaire Q1 – Customers, Q18.
56 See Questionnaire Q1 – Customers, Q11.
57 See Questionnaire Q1 – Customers, Q12.
                                                  13
 ---pagebreak---  ---pagebreak--- (69)    The remainder of this Section examines together the vertical links between the
        same upstream market and the different downstream markets. This is the case
        because (i) the Target offers the same product (or product family) in the upstream
        market to all types of downstream customers and it understands that its rivals do
        the same and (ii) the competitive assessment for each of these vertical links is
        based on comparable considerations.
4.2.2.1. Consolidated real time datafeeds (upstream) and bulk annuity insurance
           transactions, mortgages, asset management, investment banking, financial
           market services, and private equity investment (downstream)
        Input Foreclosure
(70)    The Notifying Party submitted that post-Transaction the combined entity will not
        have the ability or the incentive to foreclose downstream competitors, by
        restricting access to consolidated real time datafeeds for the following reasons.
        First, the consolidated real time datafeeds are not a necessary input for any of the
        downstream markets where Blackstone and its controlled entities are active.
        Second, any input foreclosure strategy would be defeated by the Target's rivals
        who can satisfy demand in the downstream markets. Third, any potential gains of
        a hypothetical input foreclosure strategy would be very low in view of the limited
        market share of Blackstone and its controlled entities in each of the downstream
        markets, irrespective of their precise delineation.
The Commission considers that post-Transaction, the combined entity would not have
the ability to foreclose its downstream rivals. Such an ability exists only when by
reducing access to its upstream products, the combined entity negatively affects the
overall availability of inputs for the downstream market. This is the case where the
remaining upstream suppliers are less efficient, offer less preferred alternatives, or lack
the ability to expand output in response to the supply restriction.59 By contrast, in
consolidated real time datafeeds, the Target faces competition by several major players,
e.g., Bloomberg (with a share of [20-30%]) and ICE ([0-10%]). These players could
expand output to supply consolidated real time datafeeds for any downstream players that
the Target might decide to foreclose.
(71)    Nor would the combined entity have the incentive to foreclose its downstream
        rivals. The total consolidated real-time datafeed expenditure of Blackstone and
        all its controlled entities amounts to USD [confidential], which is less than [0-5%]
        of the Target's total sales in this market in 2017. Any input foreclosure strategy
        would likely lead to a loss in consolidated real-time datafeeds that is not
        commensurate to any possible gain in the downstream markets.
(72)    The respondents in the market investigation did not raise any concern as regards
        the potential input foreclosure in the downstream markets for bulk annuity
        insurance transactions, mortgages, asset management, investment banking,
        financial market services, and private equity investment by restricting access to
        the Target's consolidated real time datafeeds.
59 Guidelines on the assessment of non-horizontal mergers under the Council Regulation on the control
    of concentrations between undertakings, OJ C 265, 18.10.2008, p. 7 ("Non-Horizontal Merger
    Guidelines"), para. 36.
                                                    15
 ---pagebreak---         Customer Foreclosure
(73)    The Notifying Party submitted that post-Transaction the combined entity will not
        have the ability or the incentive to foreclose upstream competitors in consolidated
        real time datafeeds, by restricting access to Blackstone's demand in the
        downstream markets. First, even if Blackstone and its controlled entities were to
        purchase consolidated real-time datafeeds exclusively from the Target, a
        significant and more than sufficient customer base remains available for the
        Target's rivals. Second, Blackstone portfolio entities will not start purchasing
        consolidated real time datafeeds exclusively from the Target, unless this is in the
        best interests of each entity's investor base. According to the Notifying Party, this
        in itself prevents a foreclosure strategy.
(74)    The Commission considers that post-Transaction, Blackstone would not have the
        ability to foreclose its upstream rivals in consolidated real time datafeeds. Post-
        Transaction, sufficient economic alternatives will remain in the downstream
        market for upstream rivals to sell their output. The total expenditure of
        Blackstone and its controlled entities on consolidated real time datafeeds
        represents only [0-5%] of the total worldwide demand for these products in 2017.
(75)    According to the Non-Horizontal Guidelines, an ability to foreclose upstream
        rivals exists only where the merger involves a company which is an important
        customer with a significant degree of market power in the downstream market.60
        Blackstone and its controlled entities do not have a significant degree of market
        power in the downstream markets where they are active. According to the
        Notifying Party, their share never exceeds 30% in any of the downstream
        markets.61 Moreover, in each of these markets, Blackstone and its controlled
        entities face competitive constraints from several large players who likely
        constitute a significantly large customer base for consolidated real-time datafeeds
        in the future.62
(76)    The respondents in the market investigation did not raise any concern as regards
        the potential customer foreclosure in the upstream market for consolidated real
        time datafeeds by restricting access to Blackstone's demand for these services.
        Conclusion
(77)    In view of the above and of all the evidence available to the Commission, the
        Commission considers that the Transaction does not raise serious doubts as to its
        compatibility with the internal market with respect to the vertical link between
60 Non-Horizontal Merger Guidelines, para. 61.
61 See Notifying Party's submission of 18 July 2018, "Addendum to Additional Submission of 18 July
   2018".
62 According to the Notifying Party, key rivals of Rothesay Life Limited in bulk annuity insurance
   transactions include L&G, PIC, Scottish Windows, Phoenix Live, JRP, Aviva, and Canada Life; key
   rivals of the Northview Group in mortgages (in the UK) include Lloyds Banking Group, Nationwide
   BS, Royal Bank of Scotland, Santander UK, Barclays, HSBC Bank, Coventry BS, Virgin Money,
   Yorkshire BS, and TSB Bank; key rivals of Blackstone and First Eagle Management in asset
   management include Barclays, Allianz, AXA, and ING; key rivals of Blakcstone in investment
   banking and financial market services include Goldman Sachs, JP Morgan Chase, Morgan Stanley,
   and Credit Suisse; and key rivals of Blackstone in private equity investment include Blackrock,
   Lazard, Citigroup, and Deutsche Bank.
                                                    16
 ---pagebreak---         Consolidated real time datafeeds (upstream) and bulk annuity insurance
        transactions, mortgages, asset management, investment banking, financial market
        services, and private equity investment (downstream).
4.2.2.2. MDPs (upstream) and bulk annuity insurance transactions, mortgages, life
            insurance, asset management, investment banking, financial market services,
            and private equity investment (downstream)
        Input Foreclosure
(78)    The Notifying Party submitted that post-Transaction the combined entity will not
        have the ability or the incentive to foreclose downstream competitors, by
        restricting access to MDPs for the following reasons. First, MDPs are not a
        necessary input for any of the downstream markets where Blackstone and its
        controlled entities are active. Second, any input foreclosure strategy would be
        defeated by the Target's rivals who can satisfy demand in the downstream
        markets. Third, any potential gains of a hypothetical input foreclosure strategy
        would be very low in view of the limited market share of Blackstone and its
        controlled entities in each of the downstream markets, irrespective of their precise
        delineation.
(79)    The Commission considers that post-Transaction, the combined entity would not
        have the ability to foreclose its downstream rivals. Indeed, the combined entity
        would not be able to affect the overall availability of MDPs for the downstream
        markets. The share in this (upstream) market barely exceeds 30% and the Target
        faces competition by several major MDP players, e.g., Bloomberg (with a share
        of [30-40%] in the EEA and [30-40%] worldwide), Informatica ([20-30%] in the
        EEA and [20-30%] worldwide), and Solace Systems ([0-10%] in the EEA and [0-
        10%] worldwide). These players could expand output to supply MDPs for any
        downstream players that the Target might decide to foreclose.
(80)    Nor would the combined entity have the incentive to foreclose its downstream
        rivals for two reasons:
        a) The total worldwide MDP expenditure of Blackstone and all its controlled
             entities amounts to [confidential]. This represents [less than 10%] of the
             Target's total MDP sales worldwide and [20-30]% of the Target's total MDP
             sales in the EEA in 2017.63 Any input foreclosure strategy would likely lead
             to a loss of revenues in the MDPs market that is not commensurate to any
             possible gain in the downstream markets.
        b) The (fixed) cost of developing and updating MDPs is high, while the marginal
             cost of selling one additional unit is low. MDP suppliers typically seek to
             spread their fixed costs over a sufficiently large base of customers. The
             combined entity has no incentive to forego this opportunity by restricting
             access of third parties to its MDPs.
63 This figure is overstated, as it compares the total worldwide MDP expenditure of Blackstone and its
    controlled entities with the total MDP sales of the Target in the EEA. The total MDP expenditure of
    Blackstone and its controlled entities in the EEA was not available to the Notifying Party.
                                                        17
 ---pagebreak--- (81)   The respondents in the market investigation did not raise any concern as regards
       the potential input foreclosure in the downstream market for bulk annuity
       insurance transactions, mortgages, life insurance, asset management, investment
       banking, financial market services, and private equity investment by restricting
       access to the Target's MDPs.
       Customer Foreclosure
(82)   The Notifying Party submitted that post-Transaction the combined entity will not
       have the ability or the incentive to foreclose upstream competitors in MDPs, by
       restricting access to Blackstone's demand in the downstream markets. First, even
       if Blackstone and its controlled entities were to purchase MDPs exclusively from
       the Target, a significant and more than sufficient customer base remains available
       for the Target's rivals. Second, Blackstone portfolio entities will not start
       purchasing MDPs exclusively from the Target, unless this is in the best interests
       of each entity's investor base. According to the Notifying Party, this in itself
       prevents a foreclosure strategy.
(83)   The Commission considers that post-Transaction, Blackstone would not have the
       ability to foreclose its upstream rivals in MDPs. A sufficient number of
       customers will remain in the downstream markets for upstream rivals to sell their
       output. The total worldwide expenditure of Blackstone and its controlled entities
       on MDPs represents less than [0-5%] of the total worldwide demand for these
       products in 2017 and less than [5-10%] of the total demand in the EEA.64
(84)   According to the Non-Horizontal Guidelines, an ability to foreclose upstream
       rivals exists only where the merger involves a company which is an important
       customer with a significant degree of market power in the downstream market.65
       Blackstone and its controlled entities do not have a significant degree of market
       power in the downstream markets where they are active. According to the
       Notifying Party, their share never exceeds 30% in any of the downstream
       markets.66 Moreover, in each of these markets, Blackstone and its controlled
       entities face competitive constraints from several large players who likely
       constitute a significantly large customer base for MDPs in the future.67
(85)   The respondents in the market investigation did not raise any concern as regards
       the potential customer foreclosure in the upstream market for market data
       platform services by restricting access to Blackstone's demand for these services.
64 This figure is overstated, as it compares the total worldwide MDP expenditure of Blackstone and its
   controlled entities with the total demand for MDP products in the EEA. The total MDP expenditure of
   Blackstone and its controlled entities in the EEA was not available to the Notifying Party.
65 Non-Horizontal Merger Guidelines, para. 61.
66 See Notifying Party's submission of 18 July 2018, "Addendum to Additional Submission of 18 July
   2018".
67 See fn. 62 above. According to the Notifying Party, key rivals of The Lombard Group in life
   insurance (in the UK) include Cardif, Swiss Life, La Mondiale, Allianz, Generali and AXA.
                                                       18
 ---pagebreak---      Conclusion
(86) In view of the above and of all the evidence available to the Commission, the
     Commission considers that the Transaction does not raise serious doubts as to its
     compatibility with the internal market with respect to the vertical link between
     market data platform services (upstream) and bulk annuity insurance transactions,
     mortgages, life insurance, asset management, investment banking, financial
     market services, and private equity investment (downstream).
5.   CONCLUSION
(87) For the above reasons, the European Commission has decided not to oppose the
     notified operation and to declare it compatible with the internal market and with
     the EEA Agreement. This decision is adopted in application of Article 6(1)(b) of
     the Merger Regulation and Article 57 of the EEA Agreement.
                                                  For the Commission
                                                  (Signed)
                                                  Margrethe VESTAGER
                                                  Member of the Commission
                                             19