Danfoss A/S - Eaton Hydraulics

Summary

Danfoss A/S (Danfoss) proposes to acquire the hydraulics business of Eaton Corporation plc (Eaton Hydraulics).

Danfoss and Eaton Hydraulics operate globally and overlap in the supply of various hydraulic components to distributors and original equipment manufacturers. In particular, both supply hydraulic valves, motors, steering units and other hydraulic products for use in mobile machines and vehicles designed for mechanised tasks.

Market definition

The ACCC considered the effect of the proposed acquisition on the supply of various hydraulic components for use in mobile machines and vehicles in Australia, including the supply of:

• hydraulic valves
• orbital motors, and
• hydraulic steering units.

The ACCC did not reach a concluded view on market definition as it was not necessary for the competition assessment.  

Competition analysis

The ACCC concluded that the proposed acquisition would not be likely to substantially lessen competition in any of the relevant markets because:

• Following the proposed acquisition, Danfoss and Eaton would continue to face strong competition from Bosch Rexroth, Parker Hannifin, M+S and other overseas suppliers.
• All hydraulics systems and components are imported into Australia. Market participants did not identify any products for which other imports are not readily available.
• Feedback from the market generally identified that customers were unconcerned with the proposed acquisition.