EC approves proposed acquisition of Hägglunds Drives by Robert Bosch

The European Commission has cleared under the EU Merger Regulation the proposed acquisition of Hägglunds Drives AB, a Swedish manufacturer of hydraulic drives systems and motors, by Robert Bosch GmbH of Germany. After examining the operation, the Commission concluded that the transaction would not significantly impede effective competition in the European Economic Area (EEA) or any substantial part of it.

Robert Bosch is a company with world-wide activities focussing on technology for the automobile industry, industrial technology, building technology and consumer goods. Its affiliate, Bosch Rexroth AG, is active in the production of hydraulic drive systems for industrial applications. Hägglunds Drives manufactures heavy duty hydraulic motors and drive systems for industrial applications.

The parties' activities overlap in the hydraulic drive systems for industrial applications and hydraulic motors sectors. There is also a vertical relation between the parties as Hägglunds Drives purchases hydraulic pumps produced by Robert Bosch.

The Commission's detailed examination confirmed that after the transaction the customers would still have reliable alternative suppliers and that, for all products concerned, the combined entity would continue to face several strong competitors. Customers are experienced industrial buyers who have the know-how to develop sophisticated machinery equipment and who often cooperate with suppliers to find a customised solution for their specific applications. Furthermore Hägglunds' main products (hydraulic motors with high torque and low speed) have unique characteristics so that the merger would not lead to a significant change of the competitive structure. In addition there are competitive constraints in these sectors from companies producing electric motors and drive systems.

The Commission also examined the vertical relationship and concluded that there were no indications that the merged entity would have any incentive to close off supplies of hydraulic pumps to companies seeking to buy them.