Schneider Electric acquisition of Invensys given green light under EU Merger Regulation by the European Commission

Brussels, Belgium, 29-11-2013 — /EuropaWire/ — The European Commission has approved under the EU Merger Regulation the proposed acquisition of Invensys of the UK by Schneider Electric of France. Both companies supply, in particular, automation and control systems. The Commission concluded that the transaction would not raise any competition concerns, because the activities of the two companies are complementary and the merged entity would continue to face several strong competitors in the affected markets.

In a €3.9 billion public bid, Schneider intends to acquire the automation and control activities of Invensys. The automation and control industry provides solutions for sensing, monitoring, supervising, controlling and automating objects, machines, industrial processes or systems, as well as infrastructures.

In process industries, automation and control provide solutions for manufacturing environments, where fungible materials are processed or transformed following a continuous process (for instance in chemicals, power or water plants). In discrete industries automation and control provide solutions for the assembly and incorporation of component parts into larger, more complex and discrete units (for instance in automotive or packaging plants).

The Commission examined the effects of the proposed acquisition on competition in the markets for the sale of Human Machine Interface (HMI) software, operator panels and process safety systems in the EEA and at worldwide level. HMI software assists operators in managing control machinery for industries and processes via a computer-based graphical user interface.

The Commission found that customers do not view Schneider Electric and Invensys as each other’s closest competitors. The Commission’s investigation also revealed that the two companies have complementary activities, with Schneider Electric mostly focused on automation and control for discrete industries, while Invensys is mainly active in automation and control for process industries. It has also been confirmed that the merged entity would continue to face competition from a number of other strong players, such as Siemens, ABB, Emerson and Rockwell Automation.

The Commission therefore concluded that the transaction would not raise competition concerns.

The transaction was notified to the Commission on 24 October 2013.

Companies and products

Invensys is active internationally in the electronics and engineering sector and has automation and control as its core business. Schneider Electric is also active in the automation and control sector and has further activities in electrical distribution and energy management.

In April 2013, the Commission had approved Siemens’ acquisition of Invensys’ railway signalling division (see IP/13/342).

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 notified 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 will be available on the competition website, in the Commission’s public case register under the case number M.7005