On 18 September 2017 the TCA cleared the acquisition of Opel/Vauxhall by Peugeot unconditionally. The transaction was earlier approved by the European Commission (EC).
Peugeot makes and sells passenger vehicles and light commercial vehicles worldwide under the brand names Peugeot, Citroen and DS. Opel also manufactures and sells passenger vehicles and light commercial vehicles. Opel was controlled by General Motors and represented the General Motors’ European automobile business under the brand names Opel and Vauxhall.
The TCA approved the transaction without any conditions. According to TCA’s decision, activities of the parties were overlapping vertically in sale and manufacture of automobile parts markets, and, horizontally in new passenger vehicles market. In the new passenger vehicles market, the combined market share of the parties did not exceed 20%. Considering such market share and existence of multiple competitors in the market, the said transaction did not cause competition concerns in the new passenger vehicles market, and no competition concerns in horizontal overlapping was found by the TCA. Likewise, for the vertical overlap in the sale and manufacture of automobile parts market, due to the existence of powerful competitors no competition concerns were found and consequently the said transaction was approved unconditionally.
It should be mentioned that the transaction was approved by the EC on July 5 2017, stating that no competition concerns in the relevant markets were found. The EC also identified that, in the manufacture and sale of motor vehicles markets, the combined market share of the two companies were relatively small and the merged entity would still face strong competition from manufacturers such as Renault, Volkswagen, Daimler, Ford, Fiat and various Asian competitors. As for the wholesale and retail distribution markets, the EC did not accept the argument that the said acquisition would cause detrimental effects since the distribution channels were represented by different for parties. As a result, the EC approved the transaction unconditionally.
Merger control in Turkey
The Turkish law requires a prior notification to the TCA of M&A transactions, which involve a change of control on a lasting basis, if the following financial thresholds are met (with exchange rate of CBRT as of 23.10.2017, i.e. €1 = TRY 4,32):
• The aggregate turnover of the transaction parties in Turkey exceeds TRY 100 million (approx. € 23.148.148 ), and the turnover of at least two of the transaction parties each in Turkey exceeds TRY 30 million (approx. € 6.944,444), or
• Either (i) the turnover in Turkey of the acquired assets or businesses in acquisitions, or (ii) of any of the transaction parties in mergers, exceeds TRY 30 million, and the worldwide turnover of at least one of the other transaction parties to the transaction exceeds TRY 500 million (approx. € 115.740.741).
The notification requirement is also applicable to foreign-to-foreign transactions to the extent that the mentioned thresholds are met.
Sinan Lahur
