Background
Sprengnetter GmbH intends to indirectly acquire all of the shares in and thus sole control of IMMOunited GmbH and lexunited – online information system GmbH.
Affected market
The planned merger concerns the following industry sector: other activities in the real estate sector for third parties, provision of other information services and brokerage of properties, buildings and residential flats for third parties.
AFCA investigations and competition concerns
The AFCA gathered large amounts of data and questioned the merger parties’ customers and competitors, as well as other market participants. All in all, more than 500 companies were asked to comment.
The merger would increase the parties’ market share and thereby clearly exceed the threshold of dominance in the market of digital services for real estate valuation and market analysis for third parties, which is the relevant market in the AFCA’s opinion. The AFCA fears that the merger would push up prices and reduce competition intensity, alongside foreclosure effects in several related markets. Additionally, there is the risk of higher market entry barriers, also as a result of product bundling.
In conclusion, the AFCA found that the merger could not be cleared but required an in-depth Phase II review by the Cartel Court. It has therefore filed a request for examination prior to expiry of the Phase I deadline.
Merger examinations
Under certain circumstances such as when turnover thresholds are being exceeded, the AFCA is notified of mergers of companies and will examine these mergers. Merger control ensures that innovation, price competition and quality competition are maintained in individual markets. The competition authority has four weeks to analyse the deal (Phase I investigation). This deadline may be extended by two weeks at the notifying companies’ request. Third parties, companies or consumers may report any concerns that they might have regarding the proposed merger to the AFCA in Phase I. If the Phase I investigation finds that the merger would lead to a dominant market position and if competition concerns cannot be dispelled by remedies, the AFCA will file a request for examination with the Cartel Court (Phase II investigation). The Cartel Court is obliged to examine these requests within a period of five months, with the notifying parties being allowed to request a one-month extension.