Siemens Aktiengesellschaft and Flender Holding GMBH (50/LM/Jun05) [2005] ZACT 53 (12 August 2005)

Siemens Aktiengesellschaft and Flender Holding GMBH (50/LM/Jun05) [2005] ZACT 53 (12 August 2005)

The Tribunal found that there were no significant horizontal overlaps between Siemens and Flender in South Africa, as they supply different components in the power transmission market. Vertically, while the merged entity would be able to offer complete drive solutions, the market is highly competitive, with contracts awarded through a tender and bid process, resulting in variable market shares. Customers have significant countervailing power due to their ability to specify system design and choose among competing bids. The merged entity would face competition from established integrated suppliers such as ABB, SEW, Bearing Man, and Alstom. The Tribunal concluded that the merger would not...

Citation
[2005] ZACT 53
Parties
Applicant: Siemens Aktiengesellschaft; Respondent: Flender Holding GMBH
Court
Competition Tribunal
Jurisdiction
South Africa
Judgment Date
12 August 2005
Case Number
50/LM/Jun05
Procedural Posture
Large Merger Review / Merger Clearance Reasons
Outcome
Merger unconditionally approved.
Judges
N Manoim, Y Carrim, T Orleyn
Legal Topics
Large Merger Review, Vertical and Horizontal Assessment, Market Share Analysis, Public Interest Considerations
Competition Law Commercial and Corporate Large Merger Review Vertical and Horizontal Assessment Market Share Analysis Public Interest Considerations

Case Brief

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Parties

Siemens Aktiengesellschaft

Applicant

Flender Holding GMBH

Respondent

Procedural Posture

Large Merger Review / Merger Clearance Reasons

Legal Issues

  1. 1 Whether the proposed merger between Siemens Aktiengesellschaft and Flender Holding GMBH would substantially prevent or lessen competition in the relevant markets.
  2. 2 Whether there are any public interest concerns arising from the merger.

Ratio Decidendi

The Tribunal found that there were no significant horizontal overlaps between Siemens and Flender in South Africa, as they supply different components in the power transmission market. Vertically, while the merged entity would be able to offer complete drive solutions, the market is highly competitive, with contracts awarded through a tender and bid process, resulting in variable market shares. Customers have significant countervailing power due to their ability to specify system design and choose among competing bids. The merged entity would face competition from established integrated suppliers such as ABB, SEW, Bearing Man, and Alstom. The Tribunal concluded that the merger would not...

Court Disposition

Merger unconditionally approved.

Orders

  • The merger between Siemens Aktiengesellschaft and Flender Holding GMBH is approved without conditions.