Parker Hannifin / Olaer Group Ltd
| Case Outcome | Mergers - phase 1 clearance |
| Decision Date | 21 September 2012 |
| Date | 21 September 2012 |
| Subject Matter | Mergers |
| Court | Competition and Markets Authority (EW) |
Completed acquisition by Parker Hannifin Corporation through its
subsidiary Parker Hannifin ACD Europe LLC of Olaer Group Limited
and its subsidiaries
ME/5526/12
The OFT's decision on reference under section 22(1) given on 2 1 September
2012. Full text of decision published 8 October 2012.
Please note that the square brackets indicate figures or text which have been
deleted or replaced in rang es at the request of the parties or third parties for
reasons of commercial confidentiality.
PARTIES
1. Parker Hannifin ACD Europe LLC (Parker Europe) is a wholly ow ned
subsidiary of Parker Hannifin International Corp. (Parker International),
which in turn is a wholly owned subsidiary of Parker Hannifin Corporation
(Parker). Parker and all its subsidiaries are based in the USA.
2. Parker is a worldwide diversified manufacturer of motion and control
technologies and systems, including fluid power systems,
electromechanical controls and related components. Par ker’s industrial
operations are divided into: Automation, Filtration, Fluid Connectors,
Hydraulics, Instrumentation, and Seals groups. Parker’s Hydraulics
operating group supplies hydraulic accumulators among a number of other
products such as hydraulic pumps, valves, filters and flow controllers.
3. Olaer Group Limited (Olaer) is active in the manufacture and supply of a
range of hydraulic accumulators and in the manufacture and supply of
coolers. Olaer also trades as Fawcett Christie, which, for the purposes of
this decision, is also referred to as Olaer. It is based in the UK but has a
presence on five continents, with manufacturing and sales facilities in 10
locations including USA, France, Sweden and China and sales companies in
14 countries worldwide. In the last financial year, ending on 31 December
2011, Olaer had a consolidated worldwide turnover, of approximately
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€150.5 million (£127 million). UK turnover was approximately £7.9 million
for the same period.
TRANSACTION
4. Parker has acquired indirectly, through a sale and purchase agreement
dated 24 April 2012, the entire issued share capital of Olaer. The
transaction completed on 2 July 2012. The OFT examined this merger on
its own-initiative. The administrative deadline for a decision is 21
September 2012, while the statutory deadline expires on 1 November
2012.
5. The transaction was notified in Germany, Austria, Norway and France and
has received clearance from these authorities.
JURISDICTION
6. As a result of this transaction Parker and Olaer have ceased to be distinct.
The parties overlap in the supply of accumulators. The parties submitted
that their combined share of supply did not exceed 25 per cent and
estimated that the merger created an estimated maximum combined share
of supply of some [15 - 25] per cent. However, the OFT notes that some
£[ ] million of Olaer’s turnover had been excluded by the parties in
determining this figure. This turnover was generated by a singl e contract
for the provision of accumulators to a UK firm that were subsequently to
be installed into products sold in the USA. Since the purchaser of these
products is based in the UK, the OFT considers that revenues from this
contract should be included in Olaer’s UK share of supply, leading to an
estimated combined share of supply for the parties in excess of [25] per
cent.
7. Therefore, the OFT believes that the share of supply test in section 23 of
the Enterprise Act 2002 (the Act) is met in relation to the supply of
accumulators in the UK, and the OFT believes that it is or may be the case
that a relevant merger situation has been created.
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