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The European Commission cleared Thursday Taiwanese electronics manufacturer BenQ Corp. to buy the mobile phone unit of German electronics and engineering group Siemens AG.
The commission said the "transaction has no harmful effect on competition in the European Economic Area as regards branded mobile telephones."
Although Siemens has a large market share in some European countries, BenQ does not.
"After the proposed merger, BenQ will continue to face competition from strong, well-established competitors" such as Nokia Inc. and Samsung Corp.
No competition problems are found in the markets for accessories, spare parts and related services because BenQ has an even smaller European market share in these areas.
Siemens off-loaded its mobile phone business to BenQ Corp. in June. Siemens, which has long sought a solution for its unprofitable mobile phone unit, gave the business to BenQ for free and will also buy 50 million euros (US$62.50 million) of newly-issued BenQ shares, giving it a 2.5 percent stake based on the current price.
BenQ would be able to use Siemens' brand name for five years, and the deal would close in the fiscal fourth-quarter ending Sept. 30, Siemens said.
The EU applied its simplified antitrust procedure to the deal. This clears mergers or acquisitions after one month if no objections are raised by third parties.
(Shenzhen Daily September 9, 2005)
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