EC clears TomTom's proposed acquisition of Tele Atlas
Following an in-depth phase II investigation the European Commission has approved without remedies the proposed acquisition of Tele Atlas by TomTom, both of the Netherlands. Tele Atlas is a provider of navigable digital maps and TomTom produces portable navigation devices (PNDs - often known as satellite navigation devices or SatNavs). TomTom is the market leader in the EEA in PNDs, while Tele Atlas is one of two providers of navigable digital maps offering complete coverage of Europe and North America. Navigable digital maps are essential inputs for PNDs.
The Commission's investigation focused on the ability and incentives of the merged company to increase the costs of other PND manufacturers for navigable digital maps or to limit their access to these maps, and on the impact any of these strategies might have on PND consumers. The Commission found that the merged company would be unlikely to pursue these strategies because its ability to restrict access to digital maps for other PND manufacturers would be limited by the presence of an upstream competitor, Navteq. In addition, the merged company would have no incentive to restrict access to digital maps because the sales of digital maps lost by Tele Atlas would not be compensated by additional sales of PNDs. In concluding that the proposed concentration would not raise competition concerns, the Commission's analysis also took into account the efficiencies that are likely to be generated by the proposed transaction.
A team from CRA including Paul Muysert, Tom Overstreet, Sharon Pang and Steven Salop advised Tele Atlas throughout the proceedings
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