Even the sale of parts of the companies would not have been enough to prevent a significant reduction in competition in key societal functions, the British Competition Authority justified its tough decision.
Britannian On Tuesday, the Finnish Competition Authority (CMA) scrapped the dream of the Finnish crane companies Cargotec and Konecranes.
The CMA justifies the prohibition of the merger on the grounds that the merger would significantly reduce competition in a number of different areas, from rubber-wheeled overhead cranes to terminal tractors.
The CMA lists seven different product groups where it believes competition will be significantly reduced.
Planned the merging parties had offered various ways to improve competition in different product groups, but the CMA found these drugs to be insufficient compared to how much competition would be lost from the market as a result of the merger.
In summarizing its decision, the CMA referred to the important role that various load handling equipment plays in the performance and business needs of the UK.
“Cargo handling equipment plays a key role in the smooth running of British ports. They move millions of containers every year in the UK, making sure goods arrive safely in shops and that the British business is able to deliver products to its customers abroad, ”the decision says.
If the merger could have continued without effective remedies, the CMA estimates that port terminals and other cargo handling customers would have been in a situation of deteriorating product and service quality and rising prices, or either of these options.
The CMA also stated in its 34-page solution that the merger could cause adverse chain reactions in the wider British economy.
In the CMA solution in the bulletin particular emphasis was placed on the fact that the British have few alternatives to Cargotec’s and Konecranes’ products.
Finnish companies had argued in their own investigations that the companies would face significant competition from China for their products.
The CMA did not buy the view.
Cargotec and Konecranes had also proposed to the competition authorities the sale of certain business units so that the severed parts could have been sold in combination to a third party.
Neither was eligible for the CMA. The reason was that, according to the Competition Authority, such new companies would not have been able to compete sufficiently with United Cargotec and Konecranes, thus reducing competition.
Therefore, only the prohibition of the merger provided a sufficiently effective means to prevent a reduction in competition, the CMA estimates in a statement.
Cargotec and Konecranes announced their intention to merge one and a half years ago on October 1, 2020.
A total of a number of different economic areas, including the EU and China, had already been granted conditional approvals. No permission had yet been obtained from the United States.
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