- Safegate International AB
SummaryPaiperlek Investments SAS (owner of ADB Airfield Solutions) is proposing to acquire Safegate International AB.
Market definitionMarket Definition
While the ACCC did not consider it necessary to reach a definitive view on market definition, the ACCC primarily considered the effects of the proposed acquisition in the context of:
- the national market for the supply (manufacture and imports) of airfield lighting products; and
- the national market for installation of airfield lighting products (including turnkey installation, electrical engineering contractors and installation by the airports themselves)
Competition analysisThe ACCC recognised that ADB and Safegate are currently the two largest suppliers of airfield lighting products in Australia. However, as a result of the competitive threat posed by a number of competing global suppliers who would be able to expand supply to the Australian market if Safegate and ADB were to raise prices, the ACCC concluded that the proposed acquisition is not likely to lead to a substantial lessening of competition in the national market for the supply of airfield lighting products. In addition, major airports in Australia appear to have a degree of countervailing power such that they may be able to bypass the merged entity and facilitate the entry of these suppliers.
The ACCC also considered the potential for the proposed acquisition to lead to a substantial lessening of competition in the national market for installation (or 'turnkey solutions') for airfield lighting products. Safegate is currently the only vertically integrated installer of airfield lighting products in Australia and the proposed acquisition would increase the extent of vertical integration through the combined ownership of Safegate and ADB products. The ACCC concluded that Australian airports and civil contractors have a number of alternative options for the installation of airfield lighting products including other specialist installation companies, civil engineering contractors and installation by their in-house teams. In addition, access to airfield lighting products from other competing suppliers in Australia and overseas manufacturers would be likely to prevent foreclosure of rival installation companies.
On the basis of these factors the ACCC concluded that the proposed acquisition is not likely to lead to a substantial lessening of competition in the relevant markets.
|22/09/2015||ACCC commenced review under the Merger Process Guidelines.|
|12/10/2015||Closing date for submissions from interested parties.|
|28/10/2015||Former proposed decision date of 12 November 2015 delayed by ACCC to allow additional time to consider the proposed acquisition.|
|18/11/2015||ACCC announced it would not oppose the proposed acquisition.|