Brussels, 30/06/2004 (Agence Europe) - The acquisition of Phoenix by Continental, both German producers of rubber products, has, according to the Commission, raised serious misgivings about the effect competition on two markets in particular. The proposed acquisition, which was notified on 12 May, could also create or reinforce a pan-European dominant position for Continental in the fields of air sprung suspension and conveyor belt products.
According to the Commission's inquiry, Continental and Phoenix would become Europe's largest supplier of pneumatic tyres for a wide range of vehicles (commercial, rail, private cars) and spares. On the heavy conveyor belt market, especially heavy steel cord conveyor belts and filter belts (with holes), the operation could again give rise to the largest European producer. The Commission has also found evidence that there are barriers to enter the European market for steel cord conveyor belts and filter belts, which causes concerns for competition if Phoenix were to disappear as in independent operator.
The corrective measures proposed by Continental at the preliminary inquiry were not enough to dispel the Commission's doubts. The Commission now has 90 days to conclude its second-phase inquiry.