EUROPEAN COMMISSION CONDITIONALLY CLEARS E.ON’S ACQUISITION OF INNOGY
20/09/2019
European Commission (“Commission”) has approved the acquisition by E.ON of Innogy’s distribution and consumer solutions business, subject to conditions.
E.ON and RWE, which controls Innogy, are Germany-based energy companies and they are active across the energy supply chain, from generation and wholesale to distribution and retail supply of electricity and gas. The companies’ activities overlap especially in Czechia, Germany, Hungary, Slovakia and UK. After the merger; E.ON will be active on the distribution and retail supply of electricity and gas, whereas RWE will be primarily active in electricity generation and wholesale.
After the in-depth investigation of the case, Commission notified the parties that the post-merger competition in several markets will be significantly reduced:
- The parties are two largest suppliers in the German market for the supply of electricity for heating purposes. The Commission raised competition concerns for market entry of small retailers in the post-merger era.
- The parties are two of a very limited number of suppliers who operate or plan to operate in German market for the supply of electric vehicle charging stations on motorways.
- The parties are strong suppliers and closely competing in Czech market for the retail supply of gas (to all customers) and electricity (to households and small businesses)
- The parties are Hungarian two of three major retailers active in the market for the retail supply of electricity to unregulated businesses.
Addressing the competition concerns of the Commission E.ON offered the following commitments:
- Divesting E.ON’s customers supplied with heating electricity in Germany, at the option of purchaser, all assets that necessary for effective operation of market,
- Divesting discontinue 34 electric charging stations in German motorways,
- Divesting E.ON’s business including all assets and staff in the retail supply of electricity to unregulated customers in Hungary,
- Divesting Innogy’s entire business in the retail supply of electricity and gas including all assets and staff in Czechia.
The Commission has approved the merger, conditional to full compliance of these commitments.
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