European Commission - Press release
Mergers: Commission approves acquisition of French connector producer Deutsch by TE Connectivity
Brussels, 02 April 2012 - The European Commission has cleared under the EU Merger Regulation the proposed acquisition of the French company Deutsch by the US company TE Connectivity. Both are active in the production of electronic connectors. The Commission's investigation confirmed that the merged entity would continue to face a number of credible competitors and customers would still have sufficient alternative suppliers in all markets concerned.
The Commission examined the competitive effects of the proposed acquisition, notably in the markets for electronic connectors for industrial applications, non-automotive transportation including commercial vehicles, and aerospace and defence, where both companies are active.
The market investigation showed that in these markets the parties are not each other's closest competitors as they operate on different ends of the product spectrum - Deutsch produces connectors for more harsh environments requiring a higher degree of strengthening to resist wear or abuse ("ruggedisation"). Moreover, TE and Deutsch face various other sophisticated competitors who can expand their production to cover the demand for electronic connectors for various end-uses.
The Commission therefore concluded that the transaction would not significantly impede effective competition in the European Economic Area (EEA) or any substantial part of it.
The proposed transaction was notified to the Commission on 27 February 2012.
Background on companies and products
TE designs, manufactures and markets electronic products that connect and protect the flow of power and data inside products for customers in a range of applications including automotive and non-automotive transportation, as well as industrial and defence applications.
Deutsch manufactures a variety of interconnection solutions for a range of industries including defence, offshore oil and gas and non-automotive transportation.
Merger control rules and procedures
The Commission has the duty to assess mergers and acquisitions involving companies with a turnover above certain thresholds (see Article 1 of the Merger Regulation) and to prevent concentrations that would significantly impede effective competition in the EEA or any substantial part of it.
The vast majority of mergers do not pose competition problems and are cleared after a routine review. From the moment a transaction is notified, the Commission generally has a total of 25 working days to decide whether to grant approval (Phase I) or to start an in-depth investigation (Phase II).
More information on the case is available at: