EU Blocks Mega-merger Of South Korean Shipbuilders
Faizan Hashmi Published January 13, 2022 | 09:43 PM
The EU on Thursday blocked the merger of two South Korean ship-making giants over concerns the deal would restrict the supply of large liquefied gas carriers, posing a threat to Europe's energy security
Brussels, (APP - UrduPoint / Pakistan Point News - 13th Jan, 2022 ) :The EU on Thursday blocked the merger of two South Korean ship-making giants over concerns the deal would restrict the supply of large liquefied gas carriers, posing a threat to Europe's energy security.
The takeover of Daewoo Shipbuilding & Marine Engineering by rival Hyundai Heavy Industries Holdings, the European Commission said, "would have created a dominant position by the new merged company and reduced competition in the worldwide market for LNG carriers".
The veto of the tie up comes two years after Brussels stopped India's Tata Steel and Germany's Thyssenkrupp from merging, and three years after it blocked the merger of the train-making businesses of Siemens and Alstom, angering France and Germany.
"Given the evidence of negative effects of the merger (and) the absence of remedies, the Commission decided to block the merger," said EU competition chief Margrethe Vestager at a news briefing.
The EU found that the merged entities would create a group controlling nearly two-thirds of the global LNG cargo ship market and would have grown more dominant over time.
"European customers would be left with few alternatives to the merged entity, only a handful of competitors would remain in the market," Vestager warned.
"It does not matter where the merging firms are located. What matters is whether they compete for demand in Europe," she said.