German Economy Online: Tengelmann – Definitely not

Monday, August 3, 2015

Tengelmann – Definitely not – Süddeutsche.de

There will be tight for Tengelmann and Edeka: The Monopolies Commission rejects a ministerial approval.

It is the Special Report number 70 and it has a total of 241 points and 67 sides. Two months, the experts of the Monopolies Commission in Bonn had been working, and everyone involved works councils consulted, met again for consultations. This Monday, the paper was published. It is a no, no ifs or buts – in its clarity unexpectedly significantly

The Commission, which consists of two professors and three representatives from the business sector, leaning a ministerial approval for the acquisition of 451 Kaiser’s and Tengelmann supermarkets with approximately 16 000 employees by the industry biggest Edeka flatly. There were also “no way that ministerial approval to grant conditional”, it said. All arguments that Tengelmann and Edeka have spawned in its application are taken apart in the opinion. In particular, is by no means certain whether the existing jobs even creating new ones secured by the acquisition or. There is no binding guarantees for, but demand could even consist of restructuring, which would cost jobs. Tengelmann and Edeka had argued, among other things, the business is crucial for the preservation of jobs.

By No of Bonn it could now be very tight for Tengelmann and Edeka. Although Federal Minister Sigmar Gabriel is now not officially linked, but usually follows the Minister with his decision, the Monopolies Commission, more so if the vote so clearly fails. Apparently there were no internal dissent.

Now, could the other interested parties come into play. The trading group Rewe has a great interest in a takeover. “The recommendation of the Monopolies Commission agrees with the assessment of the Rewe Group”, said a spokesman. Actually, it is now logical to withdraw the application. The Swiss Migros Group is also interested in parts of the Tengelmann branches. Previously Tengelmann CEO Karl-Erivan Haub had all expressions of interest ignored

The Cartel had the Tengelmann, Edeka deal in early April prohibited. The merger would lead to a significant deterioration of competition on already highly concentrated regional markets in Berlin, in Munich and Upper Bavaria, as well as in North Rhine-Westphalia, founded the then President of the Bundeskartellamt, Andreas Mundt. Edeka would Cartel from view but can take around one third of Kaiser’s Tengelmann locations, this was not loud but Mundt. Tengelmann emphasized at the time, the decision would lead to great uncertainty at the 16 000 employees. You get so a secure future in the Edeka composite installed.

Now Verdi demanded an “immediate solution in terms of employees”. “It’s irresponsible, repeatedly threatening to supposedly no alternative smashing of Kaiser’s Tengelmann, should not come about the deal with Edeka,” said Verdi board member Stefanie Nutzenberger. It demands a round table at which invites the policy.

The ministerial approval, which is enshrined in the law against restriction of competition (GWB) is controversial. By a decision of the Federal Cartel Office can be canceled, and that if “the overall economic benefits” outweigh the restrictions of competition or the concentration is justified by an “overriding public interest”. It is important that the Minister for Economic Affairs is not the decision of the Competition Authority examined the content, but can override overriding considerations about it.

Overall, there has been in recent decades, only 21 applications for ministerial approval, most of them have failed , Some were withdrawn, as a No loomed, for example, 2003, the proposed acquisition of the Berliner Zeitung by the Holtzbrinck publishing house. Subject to conditions, the acquisition of aircraft and arms manufacturer MBB 1989 approved by Daimler, which at the time caused a considerable public criticism. Then in 2002 the Ruhrgas takeover was conditionally approved by Eon

The process is always the same:. After the application for ministerial approval the opinion of the Monopolies Commission is first obtained. Is this before, as now in the case Tengelmann / Edeka, then performs the Ministry of Economy investigations, hear all those involved. Finally, a public hearing will be conducted, in which the Minister but not necessarily have to be present. At the end of each decision is taken not later than four months after the request, Complaints may be lodged at the Higher Regional Court of Dusseldorf.