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April 29, 2008

GERMANY: Netto-Plus merger ruling on-track

Germany’s competition watchdog has reaffirmed the May deadline for its decision on Edeka’s proposed acquisition of Tengelmann’s Plus discount chain.

Germany’s competition watchdog has reaffirmed the May deadline for its decision on Edeka’s proposed acquisition of Tengelmann’s Plus discount chain.

Under a deal struck in November, Edeka will take a 70% stake in a joint venture that will operate its Netto discount outlets and Tengelmann’s Plus stores. Tengelmann will hold the remaining 30%.

After Germany’s cartel office raised concerns that the merger would restrict market competition, the watchdog said it would need more information on the deal before coming to a decision.

The original deadline for a decision was 28 April. This was then extended to 16 May and local reports have suggested further delays.

According to a report in Financial Times Deutschland, which cited “company sources” at Edeka and Tengelmann, the cartel office is likely to take “longer than expected” to come to come to a decision.

However, when contacted by just-food today (29 April), a spokesperson for the Bundeskartellamt reaffirmed its 16 May deadline.

“The official deadline for a decision is in mid-May,” the spokesperson commented. “We are considering the companies’ comments.”

In defence of the merger, Edeka and Tengelmann reportedly told the watchdog yesterday that they would create 3,000 new jobs.

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