EU Clears German Steelmaker To Buy French Rival

Germany's Salzgitter AG acquisition of Vallourec SA's Vallourec Precision Etirage would still allow for healthy competition.

BRUSSELS, Belgium (AP) - European Union regulators on Wednesday cleared German steelmaker Salzgitter AG to buy rival Vallourec SA's Vallourec Precision Etirage, saying it saw no antitrust problems.
Salzgitter has not disclosed how much it is paying for VPE, which specializes in the manufacture of cold drawn precision tubes from its five French factories.
The European Commission said it carefully investigated whether the new company would become a more powerful supplier when they combine their businesses making round precision steel tubes for carmakers, energy supplies and the heavy engineering industry.
It checks to see if a deal would reduce customer choice and give a company the opportunity to raise prices or squeeze rivals.
But it said Salzgitter and VPE would still face several strong effective competitors with significant market shares and so it could approve the deal.
Regulators also looked at the effects on the companies' customers for seamless hollows and the distribution of precision steel tubes but did not see any risk that they would lose out.