Brussels, 6 July 2010
Mergers: Commission approves proposed acquisition of Volvo cars by Geely and Daqing
The European Commission has cleared under the EU Merger Regulation the proposed acquisition of Volvo cars by the Chinese car manufacturer Geely and the state-owned Chinese investment firm Daqing. The Commission concluded that the transaction would not significantly impede effective competition in the European Economic Area (EEA) or any substantial part of it.
Geely is a fully integrated manufacturer of cars, motorcycles and scooters in China. Currently, the vast majority of its passenger cars are sold in China. Daqing is owned by the government of Daqing State, in northeast China. Daqing's sole business is the investment and management of state-owned assets. Volvo Cars consists of the passenger car business of Volvo. Volvo manufactures, distributes and sells a wide range of passenger cars under the Volvo brand worldwide. To a limited extent, it is also active in the provision of components.
The Commission’s examination of the proposed transaction showed that the horizontal overlaps between the activities of the companies were very limited, since Geely has almost no passenger car sales in Europe. Furthermore, Volvo's very limited presence in the field of supply of diverse car components would not allow the merged entity to close off other market players.
The Commission's approval of the merger is without prejudice to any eventual assessment or decision that it may undertake or adopt in the state aid field that may affect the parties to the present transaction.
The transaction did not initially qualify for the EU's one-stop shop review because the acquirers did not meet the triggering turnover threshold, but since it was notifiable in at least three EU Member States, the parties asked the Commission to examine the deal and the countries concerned agreed to it. The transaction was notified to the Commission for regulatory clearance on 1 of June 2010.
More information on the case will be available at: