The European Commission has approved unconditionally, under the EU Merger Regulation, the proposed acquisition of Infinera Corporation (‘Infinera’) by Nokia Corporation (‘Nokia’). The Commission concluded that the transaction would raise no competition concerns in the European Economic Area (‘EEA’).
The Commission’s investigation
Both Nokia and Infinera supply optical transport equipment used to transmit data through optical fibre cables. According to the parties, the Transaction will allow the merged entity to attain the requisite scale in its optical networking business to accelerate its product roadmap and compete more vigorously with larger competitors in the market.
The Commission investigated the impact of the transaction on the global or EEA markets for the supply of optical transport equipment, as well as on the narrower segments of such markets based on the type/application of the equipment. Based on its market investigation, the Commission found that Nokia and Infinera’s combined market shares in the global or EEA markets for the supply of optical transport equipment, as well as on the narrower segments of such markets, are moderate. It also found that there are several credible competitors on those markets that, following the transaction, will continue to exert sufficient competitive pressure upon Nokia.
The Commission therefore concluded that the proposed acquisition would not raise competition concerns in the EEA and cleared the transaction unconditionally.
Companies and products
Nokia is a publicly traded company headquartered in Finland. It is active globally in a wide range of areas including network infrastructure, mobile networks, cloud & network services and technologies.
Infinera is a publicly traded company headquartered in the US. It is a global supplier of networking solutions, comprising networking equipment, optical semiconductors, software and services.
Merger control rules and procedure
The Commission has the duty to assess mergers and acquisitions involving companies with a turnover above certain thresholds (see Article 1 of the EU Merger Regulation) and to prevent concentrations that would significantly impede effective competition in the European Economic Area or any substantial part of it.
The vast majority of notified mergers do not pose competition problems and are cleared after a routine review. From the moment a transaction is notified, the Commission generally has 25 working days to decide whether to grant approval (Phase I) or to start an in-depth investigation (Phase II).
