Brussels, 08/02/2007 (Agence Europe) - On 8 February, the European Commission approved the planned acquisition of American Power Conversion Corporation (APC) by the French group Schneider Electric. Both companies are major suppliers of a broad range of uninterruptible power supply (UPS) devices which clean power signals and provide back-up power in case of power cuts. The Commission's clearance is conditional upon the divestiture of Schneider Electric's business related to small UPS devices. In light of these commitments, the Commission concluded that the transaction would not significantly impede effective competition in the European Economic Area (EEA) or any substantial part of it.
Schneider is active in the manufacturing and sale of products in the sectors of electrical distribution, industrial control and automation. Amongst other products, it supplies UPS devices through its subsidiary MGE UPS Systems S.A. APC is active in the design, manufacturing and sale of power protection equipment and software and accessories for computers, communications and related equipment, in particular UPS devices.
The Commission examined the competitive impact of the proposed merger in the UPS devices markets where both companies are active as suppliers. The Commission's market investigation revealed that the proposed acquisition could significantly reduce competition as regards the market for small UPS devices (that is, with a power range below 10 kiloVolt-Ampere (kVA)) which are used mainly to protect individual computers and devices for small businesses. APC and MGE are respectively number one and number two in this market at European level and the next competitor has a very limited market position so the Commission considered that the proposed transaction as initially notified was likely to weaken competition and raised serious doubts as to its compatibility with the Single Market.
To address the Commission's serious doubts, Schneider Electric pledged to divest the MGE activities related to its small UPS business. After consulting market players, the Commission concluded that the commitments were suitable to remedy the competition concerns. More information on the case: http: //ec.europa.eu/comm/competition/mergers/cases/index/m89.html#m_4475