Brussels, 30/08/2004 (Agence Europe) - The European Commission has authorised the joint take-over by CVC Capital Partners (Luxembourg), which is active in investment management, and the private equity fund Permira Europe III, which is controlled by Permira Holdings Limited (UK), of AA. The Commission found that this transaction will not lead to any competition problems in the three markets it examined for this transaction. The AA, which provides breakdown and roadside assistance services in the UK and Ireland through intermediary companies and car rental companies. Kwik-Fit one of CVC's portfolio companies, sells insurance policies offering the same service on behalf of a third party providers but as opposed to the AA, it does not provide these services itself. Due to Kwik-Fit's insignificant market share in the UK market alone, the transaction does not result in any competition concerns in the UK market for breakdown and roadside assistance.
The AA provides car data check services through Motorfile (a joint venture with Experian) that provides the services under the AA brand. Halfords, a company in which CVC funds hold a significant shareholding, acting as an intermediary, directs customers to third parties providing the service. Both the AA and Halfords provide this service in the UK only. Due to the insignificant increment in market shares resulting from the transaction, the Commission concludes that it does not raise any competition concerns with respect to car data checks services.
The Commission has also examined the extent to which the transaction could produce foreclosure effects in the British spare-parts markets. Halfords already proves automotive spare parts to AA and even if it did become, following the operation, the exclusive supplier, it would not distort competition. It concluded to the absence of such effects since in all categories of automotive spare-parts, the AA accounts for a very small percentage of the total UK purchases.