Mergers: Commission approves proposed acquisition of TietoEnator by Nordic Capital
Posted by Oliver B. at 10:09 PMThe European Commission has cleared under the EU Merger Regulation the proposed acquisition of TietoEnator, a Finnish provider of information technology services by Jersey-based investment fund Nordic Capital. The Commission concluded that the proposed transaction would not significantly impede effective competition in the European Economic Area ("EEA") or any substantial part of it.
Nordic Capital is a private equity company which invests in large and medium-sized companies, predominantly in the Nordic region. Nordic Capital controls the Swedish company Aditro, which is active in the provision of information technology (IT) services and Enterprise Application Software (EAS).
TietoEnator provides IT services and is primarily active in Finland, Sweden, Norway and Denmark.
The Commission’s examination of the proposed transaction showed that the horizontal overlaps between the activities of TietoEnator and Aditro in relation to IT services were limited and that, for all categories of IT services, the combined entity would continue to face several strong, effective competitors, such as IBM, CapGemini, Accenture and Hewlett-Packard.
The Commission also investigated the vertical relationship between the activities of Aditro in the market for the supply of EAS, and TietoEnator's and Aditro's activities in the market for the provision of IT services. As EAS may be used in combination with many IT services, the merged entity could in theory try to take advantage of its enlarged customer base in IT services to leverage its position from one market into the other. However, in view of Aditro's limited share of the EAS market in the Nordic countries and the purchasing pattern of Nordic customers, who tend to select their EAS and IT services suppliers separately, the Commission concluded that this vertical relation was unlikely to raise competition concerns.
Further information relating to this case will be available at:
http://ec.europa.eu/comm/competition/mergers/cases/index/m102.html#m_5128
