Schneider-LeGrand merger

Type :

Case study

Pages :

13 pages

Format :

.doc

Published date :

01/16/2009

Category :

Business & market

Sub category :

Business strategy

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Summary :

Why the European Commission blocked the French merger.
1. Acquisition of sole control.
2. Low-voltage electrical equipment sector.
3. Impose the prices and control the market.
4. Restricting effective competition.
Links that exist between competition and concentration: Mario Monti and the economic theories.
1. A formalized policy regarding the intervention of the state apparatus in the dealings of the private sector.
2. The competition policy.
3. The Commission's endeavour to protect effective competition.
4. The greater attention paid to post-concentration efficiencies.
Is it usual to meet this kind of refusal in Europe?
1. Numbers and examples.
2. General theories and aims of the EU competition policy.
3. Conclusion.
The arguments against Mario Monti's position on mergers and acquisitions.
1. Mario Monti's position.
2. Arguments against Mario Monti's position.
3. Impact of the case on the Mario Monti's approach and on the merger regulation.
Bibliography.

Abstract

Beginning with a certain turnover, the EU merger rules are to be applied to cross-border concentrations, irrespective of the size of the company or area of their activity. A pre-merger notification to the European Commission is obligatory. Most cases are closed by the completion of the phase I, which lasts approximately six weeks. Only a small percentage (5%) passes into the phase II, which means another four months time of investigation. The final decision is then subject to juridical review by the Court of First Instance (CFI) and European Court of Justice. At the beginning of the new millennium high-profile cases have called attention to the differences in approach between the competition authorities. On 16 February 2001 the Commission received a notification of a merger plan of schneider Electrics who wanted to acquire legrand by way of an exchange of shares announced on 15 January 2001. The offer involves a concentration of all the shares of legrand and according to the merger Regulation that demonstrates an acquisition of sole control.