REG - Competition and Mkts - Merger Update: Arçelik / Whirlpool
07/03/2024 08:15
For best results when printing this announcement, please click on link below: http://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20240307:nRSG9678Fa&default-theme=true RNS Number : 9678F Competition and Markets Authority 07 March 2024 FOR IMMEDIATE RELEASE - THURSDAY 07 MARCH 2024 Domestic appliances deal cleared by the CMA Following a provisional clearance in February, the CMA is now allowing the proposed deal between Arçelik and Whirlpool to go ahead. Arçelik and Whirlpool are two of the largest suppliers of major domestic appliances (MDAs) in the UK, including washing machines, tumble dryers, dishwashers and cooking appliances. Arçelik supplies MDAs primarily under the Beko, Blomberg and Grundig brands, and Whirlpool supplies MDAs primarily under the Indesit and Hotpoint brands. The Competition and Markets Authority (CMA) referred the deal to a Phase 2 review after initially identifying concerns which warranted further investigation (https://www.gov.uk/government/news/home-appliances-merger-could-reduce-choice-for-consumers) during its Phase 1 investigation. Since then, an independent CMA panel has gathered and analysed a wide range of evidence - including seeking views from businesses and customers - in order to assess the potential impact of this deal. The panel reviewed evidence which showed that while Arçelik and Whirlpool both have strong market positions, they will continue to face significant competition from other suppliers. This includes well known suppliers and brands such as BSH (including its Bosch and Neff brands), Haier Group (including its Hoover and Candy brands), Samsung and LG; retailers' 'private label' brands such as Logik and Bush (Currys and Argos); and more recent entrants such as Hisense. The evidence also showed that the competitive landscape has changed considerably in recent years and continues to do so. Whirlpool's market position in MDAs has significantly declined over the last decade, and it is likely that its European MDA business will be fundamentally different in the future. At the same time, suppliers such as Haier Group and Hisense have gained market share, and it is likely that they will continue to expand. These market dynamics are supported by a range of evidence, including from internal documents, financial analysis and third parties. Martin Coleman, chair of the independent expert panel conducting the investigation, said: "We conducted a thorough investigation into this deal, which included extensive engagement with customers, competitors, and others. We found that the deal may not be expected to harm competition, with shoppers continuing to benefit from a wide range of options. "As such, we believe this deal should be allowed to proceed." For more information, visit the Arçelik /Whirlpool case page (https://www.gov.uk/cma-cases/arcelik-slash-whirlpool-emea-merger-inquiry) . Notes to editors 1. Publication of the final report marks the end of the CMA's Phase 2 investigation. 2. In a Phase 2 review, the panel considers whether there is a more than 50% chance that a deal may be expected to substantially lessen competition (SLC) - a higher threshold than the 'realistic prospect' SLC test that is applied by the CMA in Phase 1. Accordingly, some deals that are referred to Phase 2 may ultimately be cleared. 3. Pursuant to a Contribution Agreement dated 16 January 2023, Arçelik will set up a new standalone business, Beko Europe B.V., to which Arçelik will contribute its European MDA and small domestic appliances businesses and Whirlpool will contribute its EMEA MDA business. On completion of the deal, Arçelik will hold c.75%, and Whirlpool will hold c.25%, of the shares in Beko Europe. 4. In February 2024 the CMA provisionally found that the deal may not be expected to result in a substantial lessening of competition in any markets in the UK, including for the supply of washing machines, tumble dryers, dishwashers and cooking appliances (which comprises cookers, ovens and hobs). Having considered representations received, that provisional finding is now confirmed in the CMA's final report. 5. For more information, journalists should contact the CMA press office by email on press@cma.gov.uk (mailto:press@cma.gov.uk) or by phone on 020 3738 6460. This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com (mailto:rns@lseg.com) or visit www.rns.com (http://www.rns.com/) . RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy) . END MEREDLBBZXLFBBZ