UK: The Competition & Markets Authority has approved Hitachi Rail’s proposed €1·7bn purchase of Thales’ Ground Transportation business following Hitachi’s offer to sell its existing main line signalling business in the UK, France and Germany.
CMA will need to approve the purchaser, and key customers will also need to agree to the transfer of relevant contracts.
The regulator’s in-depth investigation of Hitachi’s proposed acquisition of Thales GTS had raised concerns about future competition in the UK main line digital signalling market. This is currently dominated by Siemens Mobility and Alstom, with infrastructure manager Network Rail taking steps to introduce a broader range of suppliers into the market.
On October 4, CMA said Hitachi’s proposed divestment of certain activities would be an effective and proportionate remedy to its concerns, preserving competition and ensure customers such as Network Rail would not be negatively affected by the merger.
The authority had concluded that the merger would not reduce competition in the urban rail CBTC market, because while Thales is an important supplier to London Underground, Hitachi would be unlikely to meet Transport for London’s requirements in the foreseeable future.
12 out of 13 approvals
Hitachi Rail and Thales have now secured regulatory approvals in 12 of the 13 jurisdictions where merger clearance is required.
It refiled its application with the European Commission on September 14, and expects a final decision by early November.
A Hitachi Rail spokesperson said ’we believe strongly in the competitive benefits of the deal to acquire Thales Ground Transportation Systems, which will deliver value for customers in the rail signalling and mobility sectors in Europe and around the world’.
