EUROPE: The European Commission has opened an in-depth investigation into Nidec’s proposed acquisition of refrigeration compressor manufacturer Embraco under the EU merger regulations.
The Commission is concerned the takeover announced by Japanese manufacturer Nidec in April may reduce competition in the supply of refrigeration compressors.
The proposed $1,080m acquisition from owner Whirlpool follows Nidec’s €185m purchase last year of hermetic compressor manufacturer Secop and the creation of Nidec Global Appliance Compressors.
Commissioner Margrethe Vestager, in charge of competition policy, said: “This industry is already highly concentrated, therefore the Commission will closely analyse the impact on competition of Nidec’s proposed acquisition of Embraco, to ensure their customers and final consumers are not harmed due to higher prices or less choice.”
Nidec and Embraco both produce compressors that are used in domestic refrigerators and freezers, and for light commercial use, for instance beverage coolers, commercial refrigerators and freezers, and refrigerated display cabinets. The companies are also among the leading suppliers worldwide and in the Europe for variable and fixed speed refrigeration compressors.
The Commission’s initial market investigation has identified a number of concerns with regard to the possibility of higher prices and less choice. Nidec is said to have submitted certain commitments in order to address the competition concerns, but the Commission concluded that they were insufficient to remove the concerns raised.
The transaction was notified to the Commission on October 8, and the Commission now has until 15 April 2019, to make a decision.
Nidec is active in the engineering, manufacture, and distribution of a range of electric motors and motor application products. Since its acquisition of Secop GmbH in 2017, Nidec also manufactures and sells compressors for use in refrigeration appliances. Nidec manufactures compressors in Austria, Slovakia and China.
Based in Brazil, Embraco is owned and controlled by US company Whirlpool. It manufactures compressors in Slovakia, Brazil, Mexico and China.
Nidec to acquire Embraco – 24 April 2018
JAPAN: Nidec, the Japanese manufacturer of electric motors, is to increase its expansion into the refrigeration market with the acquisition of compressor company Embraco. Read more…