The European Commission has cleared the proposed acquisition of ABB’s high voltage cable business and power cable accessories business by NKT.
NKT announced its intention to acquire ABB’s businesses in September 2016, for a total enterprise value of EUR 836 million (USD 934 million).
The Commission concluded that the merged entity would continue to face effective competition in Europe.
In its investigation, the Commission looked at the effects on competition of the removal of one competitor, and whether the transaction would make it more likely that the remaining players could co-ordinate their competitive behaviour.
The Commission’s investigation focused on the parties’ overlapping activities for high voltage power cables, in particular, on AC submarine power cables and DC submarine power cables. NKT is a potential entrant in the market for DC submarine power cables.
Based on the results of its market investigation, the Commission found that the proposed acquisition would not result in a significant reduction in competition and that a number of strong competitors will remain post-transaction.