Brussels, 03/11/2003 (Agence Europe) - The European Commission has authorised Sydkraft, the second largest electricity company in Sweden, to take over its rival, Graninge, the fifth largest producer in Sweden. Sydkraft and Graninge are active in the generation, transmission, distribution and sale of electricity. The Commission had expressed concern about the competition restrictions that the merger might cause in Sweden where the three main players, including Sydkraft, have a combined market share of more than 80%. It therefore examined the effect that the merger would have at the production and end-user stages. Although the oligopolistic market structure presents some challenges for the maintenance of effective competition, the removal of Graninge as an independent player (which only makes up 2% of the market in Sweden) on either level does not alter the competition landscape significantly, either in Sweden or in the Nordic countries as a whole. The new undertaking will not be able to give rise to competition concerns if it acts unilaterally or with others, given the limited production capacity of Graninge. The size of the new entity will still represent less than half of that of the main player in Sweden, Vattenfall, the Commission noted. As far as all Nordic countries are concerned, the market share of the merged entity is below 10% and will not give rise to competition concerns.