European Commission Approves Auchan Acquisition of Hungarian Retailer Magyar Hipermarket
The Commission's investigation confirmed that the merged entity would continue to face competition from a number of other strong competitors and that customers would still have sufficient alternative suppliers in all markets concerned.
19 April 2012 --- The European Commission has cleared under the EU Merger Regulation the proposed acquisition of Magyar Hipermarket Kereskedelmi Kft. by the French retail group Auchan. The Commission's investigation confirmed that the merged entity would continue to face competition from a number of other strong competitors and that customers would still have sufficient alternative suppliers in all markets concerned.
The parties' activities overlap in the market for the retail sale of daily consumer goods in non-specialised stores in Hungary. The transaction gives rise to a number of horizontally affected markets, mainly in the great Budapest area. However, the merged entity will still face strong competitive pressure from the other market players in Hungary and in particular in Budapest. In addition, the Commission's investigation confirmed that the market for the retail sale of daily consumer goods in Hungary is highly dynamic and has been characterised by the recent entry of new players which quickly seized important shares of the market.
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 transaction was notified to the Commission on 9 March 2012.
Auchan is an international retail group that is primarily active in the market for retail of daily consumer goods in several EEA countries.
Magyar Hipermarket is a Hungarian company active in the retail of daily consumer goods in Hungary where it operates 7 hypermarkets under the Cora brand (as a licensee of Cora France).
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).
