Brussels, 19/10/2011 (Agence Europe) - After conducting an in-depth investigation, the European Commission gave its approval, on Wednesday 19 October, to the acquisition of the hard disk drive (HDD) business of Samsung Electronics of Korea by Seagate Technology of the United States. The merger will further consolidate markets that are already highly concentrated but the Commission concluded that the transaction would not significantly impede effective competition in European Economic Area (EEA).
The main impact of the transaction is on the markets for 3.5" desktop hard disk drives and 2.5" mobile hard disk drives where the investigation revealed that Samsung is not a particularly strong competitor. After the operation, there will still be three strong suppliers on the 3.5" desktop market (the merged entity, Western Digital of the US and Japan's Hitachi Global Storage Technologies) and four strong suppliers on the 2.5" mobile market (the three already named, plus Toshiba, also of Japan). The Commission found that the proposed transaction would not jeopardise the business of Japan's TDK, an independent supplier of heads for HDDs, as the merged entity will continue to buy a sufficient volume of components from TDK post-merger. The Commission found, too, that there would be no effect on the market for external hard disk drives in the EEA as non integrated suppliers of external hard disk drives would retain sufficient alternative sources for hard disk drives. The Seagate/Samsung deal was assessed independently of Western Digital's proposed acquisition of the HDD and Solid State Drives (SSDs) businesses of Hitachi Global Storage Technologies, which is still pending. (OL/transl.rt)