Undertaking given by Thales S.A.

Company or individual details

  • Thales S.A.


On 20 December 2018, the ACCC announced it had accepted an undertaking (the Undertaking) from Thales pursuant to s 87B of the Competition and Consumer Act 2010 (Cth) in connection with Thales’ proposal to acquire all issued and outstanding ordinary shares of Gemalto by way of a full public offer subject to the terms and conditions of a 17 December 2017 merger agreement between Thales and Gemalto (the Proposed Acquisition).  The Proposed Acquisition will result in Gemalto becoming a subsidiary of Thales.

On 24 September 2018, the ACCC commenced its public review of the Proposed Acquisition. The ACCC undertook market inquiries and considered information provided by the parties to the Proposed Acquisition, industry participants and others.

The ACCC concluded that, in the absence of the Undertaking, the Proposed Acquisition would have the effect, or be likely to have the effect, of substantially lessening competition in the supply of General Purpose Hardware Security Modules (GP HSMs) in Australia (the Relevant Market). The parties are close competitors and are the market leading providers of GP HSMs in Australia. In particular, the ACCC was concerned that the Proposed Acquisition would lead to significant concentration and reduce competitive tension in the market for GP HSMs, resulting in higher prices, less innovation and lower quality products and services.

The objective of the Undertaking is to address the ACCC’s competition concerns as set out above that would otherwise arise as a consequence of the Proposed Acquisition. The Undertaking aims to achieve this objective by placing obligations on Thales to:

  1. ensure the Divestiture Business is sold to an Approved Purchaser;
  2. create or strengthen a viable, effective, stand-alone, independent and long term competitor for the Relevant Market in Australia;
  3. ensure the purchaser of the Divestiture Business has all the necessary associated assets and rights to compete effectively with Thales in the Relevant Market in Australia;
  4. maintain the economic viability, marketability, competitiveness and goodwill of the Divestiture Business in Australia prior to divestiture; and
  5. provide for the effective oversight of Thales’ compliance with this Undertaking.