Siemens-Alstom transaction may be closed in the first half of 2019

After the submission of the remedy package on Siemens and Alstom combination (December 2018), in a press release on the results of its first nine months of 2018/19, Alstom confirmed that the transaction is expected to be closed in the first half of 2019. The transaction is subject to approval by relevant anti-trust authorities.
Since December, Alstom and Siemens had a continuous dialogue with the European Commission, including some improvement of the remedy package to respond to the EC concerns. The proposed package represents the parties’ proposal to address the Commission’s concerns while preserving the industrial and economic value of the deal. There is no certainty that the content of this package will be sufficient to alleviate the concerns of the Commission. On February 18, the two companies expect the EC’s decision.
We remind you that the proposed remedies include mainly signalling activities as well as rolling stock products and represent around four percent of the sales of the combined entity.
In July 2018, the EC has announced the opening of an in-depth investigation on the proposed acquisition of Alstom by Siemens, under the EU Merger Regulation. The Commission raised concerns that the merger may reduce competition in the supply of several types of trains and signalling systems.
Following EC’s announcement, in October, the EU antitrust regulators sent a series of objections over the proposed Siemens-Alstom rail business merger.
The initial investigation found that the combined entity will be nearly three times larger than its closest competitor. The Commission claimed that the proposed transaction would reduce competition in the markets where the merged entity would be active. According to the EC, the transaction could lead to higher prices, less choice and less innovation due to reduced competitive pressure in rolling stock and signalling tenders. ‘This would be to the detriment of train operators, infrastructure managers and ultimately European passengers who use trains and metros on a daily basis,’ EC said in its statement from July.

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