Merger analysis

The past decade has seen a revolution in the role of economics in merger cases, with empirical and theoretical economic analyses now central to merger investigations.

Economic analysis has taken centre stage in merger control over the last decade, following landmark Court judgments on merger appeals, the creation of influential Chief Economist roles at major European competition authorities, and the development of DG Competition's Guidelines on the assessment of horizontal and non-horizontal mergers.

Merger assessment now fully embraces modern economic thinking on the behaviour of oligopolistic markets, and theories of harm are closely tested against the available data and documents - increasingly requiring the use of detailed transactional data from the parties.

Economic advice is commonly sought at the planning stage of a transaction to identify potential competition problems at the earliest opportunity and in many cases to undertake pre-emptive empirical work that can smooth and speed the progress of the competition investigation.

We help define the relevant markets, anticipate the likely theories of harm that will be raised by competition authorities, identify the most appropriate model of competition for assessing the effect of the merger, select the relevant empirical tests to predict the likely impact of the merger on competition, collect and process the data needed to run such tests, and consider the potential implications of different remedies packages.

As part of this analytical process we work closely with clients and their legal advisors to respond to information requests from the competition authorities. Such requests can require clients to extract, collate and format large volumes of data to meet the authorities' requirements in tight timescales. We work with clients and economists in the competition authorities to make the process of responding to such requests as efficient as possible.

We have a strong reputation for helping clients gain approval in the first phase of an investigation, thus avoiding full-scale inquiries. At the same time, CRA's economists have worked on some of the most important and controversial cases of recent years. We have advised parties in landmark cases that have changed the course of competition policy enforcement in Europe, such as Airtours, Tetra Laval/Sidel and GE/Honeywell, both in the administrative proceedings and in appeal to the Court of First Instance (CFI).

European Commission cases on which we have advised include:

• Panasonic/Sanyo (2009)
• Lufthansa/Austrian Airlines (2009)
• Pfizer/Wyeth (2009)
• Lufthansa/Brussels Airlines (2009)
• Posten/Post Danmark (2009)
• Sanofi-Aventis/Zentiva (2009)
• Sappi/M-real (2008)
• Pernod Ricard/Vin & Spirit (2008)
• BAT/STK (2008)
• TomTom/Tele Atlas (2008)
• Huntsman/Hexion (2008)
• Oracle/BEA (2008)
• Randstad/Vedior (2008)
• Saint-Gobain/Maxit (2008)
• Thomson/Reuters (2008)
• INEOS/Kerling (2008)
• Yara/Kemira GrowHow (2007)
• Ryanair/Aer Lingus (2007)
• Kraft/Danone (2007)
• SCA/Procter & Gamble (2007)
• CVC/Ferd/Elopak/SIG (2007)
• Owens Corning/Vetrotex (2007)
• INEOS/BP Dormagen (2006)
• Inco/Falconbridge (2006)
• Alcatel/Lucent (2006)
• Linde/BOC (2006)
• T-Mobile/tele.ring (2006)
• adidas/Reebok (2006)
• Telefónica/O2 (2006)
• E.ON/MOL (2005)
• Saint-Gobain/BPB (2005)
• Procter & Gamble/Gillette (2005)
• ENI/EDP/GDP (2005 - CFI appeal)
• Oracle/PeopleSoft (2004)
• News Corp/Telepiù (2003)

We also have extensive experience in merger investigations undertaken by national competition authorities, including the German, French, Austrian, Belgian, Dutch, Italian, Irish, Spanish, and Portuguese authorities, as well as the OFT and the Competition Commission in the UK.

CRA's recent UK experience includes Capita/IBS, Centrica/British Energy, Dunfermline Press/Berkshire Regional Newspapers, Lloyds TSB/HBOS, Co-op/Somerfield, Home Retail Group/Focus stores, Seawell/Noble UK, Macquarie Funds/Airwave Safety Communications, Kemira GrowHow/Terra Industries, Pan Fish/Marine Harvest, Arqiva/BT SBS, Stericycle International/Sterile Technologies Group and Boots/Alliance Unichem.

In addition we have been involved in many high-profile cases before the South African competition authorities, including Vodacom/StorTech, Vodacom/Gateway, Netcare/Community Hospital Group, Telkom/BCX, Sasol/Engen, Harmony/Gold Fields, Ellerines/Relyant and Anglo American/Kumba Resources.

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