EU Commission to carry in-depth examination of Tele Atlas acquisition

EU Commission to carry in-depth examination of Tele Atlas acquisition
TomTom and Tele Atlas today announced that the European Commission has decided to initiate second phase review allowing the Commission to carry out an in-depth examination of the transaction and its market impact.

The standard duration of a second phase proceeding is 90 working days, which can be extended to 125 working days. However, the Commission is not required to take this full period to reach a decision.

“We have reasonable insight about the likely outcome of the second phase review towards the end of the first quarter of 2008”, estimated TomTom and Tele Atlas in a joint statement this morning.

As a consequence, TomTom has extended the acceptance period for its offer. The acceptance period which began on 19 November 2007 will now end on 31 March 2008.

A press release from the EU Commission stated today: ”After a preliminary review, the Commission has identified serious doubts that the acquisition by TomTom of Tele Atlas might, in the light of the duopoly market for navigable digital maps and TomTom's strong position on the market for PNDs, lead to a significant impediment of effective competition within the EEA.
Navigable digital maps are essential inputs for producers of PNDs. The proposed acquisition raises vertical competition concerns because TomTom acquires one of the current two map suppliers that provide maps for the whole of Europe. The Commission's in-depth investigation will focus, inter alia, on assessing whether the transaction would increase the costs of other PND manufacturers for navigable digital map or limit their access to these maps, and as a consequence harm consumers”.

Wednesday, November 28th 2007

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