Preussen Elektra/EZH - Electricity

United Kingdom

Background Acquisition by Preussen Elektra AG (part of the VEBA AG group) of control of the whole of the Dutch regional electricity provider NV Electriciteitsbedrijf Zuid-Holland (EZH).

Assessment The Commission cleared the operation. On the market for generation, the market share of the parties would not amount to more than 15%. On the market for transmission, the Commission examined whether vertical issues may arise as a result of the concentration. However, it found that until the majority of the shares in TenneT are owned by the Dutch State, EZH does not exercise its voting right through SEP in TenneT without the consent of the Dutch Minister of Economic Affairs. Pursuant to the share purchase agreement, Preussen Elektra has not agreed to exercise this right without prior approval of the Dutch Minister of Economic Affairs as well. The Commission therefore assumed that the voting right will be exercised only in the interest of the Dutch State as the future owner as opposed to the interest of Preussen Elektra. Therefore, the market for electricity transmission will not be affected as a result of the merger, and no vertical issues arose on this market. (COMP/M. 1659, 30/09/99, public version available February 2000).