The Netherlands Authority for Consumers and Markets (ACM) has cleared the acquisition of PGB by Global Automotive. Global Automotive and PBG are mainly active in the distribution of replacement tires and replacement wheels for cars and vans. The market study revealed that, after the acquisition, sufficient competitive pressure will remain.
What is this case about?
Tires of all cars need to be replaced regularly. Most tires are sold through wholesalers. Global Automotive is the parent company of several companies that sell tires and wheels to other wholesalers as well as to retailers. Global Automotive is the owner of companies such as Inter-Sprint, Tyreteam, Banden Express, or Wheel Tyre. PBG mostly caters to retailers, and hardly sells tires to other wholesalers. ACM has come to the conclusion that this acquisition will change little for wholesalers that buy tires from Global Automotive or PBG. This acquisition will mostly affect the sales to retailers.
ACM has conducted a more detailed market study among manufacturers, competitors, and buyers of tires. ACM has established that sufficient alternatives will remain on the market for tires for retailers. ACM expects that sufficient competitive pressure will continue to be exerted, and that the new combination will not be able to raise prices or reduce the quality of their services.
ACM also assessed what the consequences would be for the market for replacement wheels. ACM has established that, in that market too, sufficient competition will remain.
ACM’s concentration control: mergers, acquisitions, and joint ventures
With any merger or acquisition, there is the question of whether sufficient competition will remain on that market, right after the transaction as well as in the future. Competition ensures that products are of high quality and that they are offered on the market at competitive prices. Competition also promotes innovation. That is why ACM decides in advance whether or not companies are allowed to merge or acquire another company. ACM assesses whether the markets involved will continue to work well for people and businesses, now and in the future.
More in this case
01-02-2021 Global Automotive Investments Holding wishes to acquire PBG (concentration notification) (in Dutch)