FCCA to further investigate competition effects of acquisition between Danish Agro Machinery and Konekesko

The Finnish Competition and Consumer Authority (FCCA) has initiated further proceedings with regard to an acquisition whereby Danish Agro Machinery Holding A/S will acquire Konekesko Oy’s agricultural machine, farm machine and groundcare machine business.

Danish Agro Machinery Holding A/S is a subsidiary of Danish Agro a.m.b.a., which owns and manages other companies operating in the agricultural machine business. The Danish Agro group engages in the agricultural machine business through its subsidiary Hankkija Oy. Hankkija engages in the import, sale and maintenance of agricultural machines and farm machines as the sole distributor of the John Deere brand in Finland. In the farm machine market, Hankkija also sells other brands.

Konekesko Oy is part of the Konekesko group and a subsidiary of Kesko Oyj. Konekesko also engages in the agricultural machine, farm machine and groundcare machine market, including the import and sale of spare parts for them. Konekesko’s core product range consists of agricultural machines and spare parts of the CLAAS brand.

On the basis of the FCCA’s preliminary assessment, the acquisition raises concerns that the transaction could restrict competition in the market of self-propelled forage harvesters, in which the parties’ combined market share is significant. The combined market share by the companies in the sale of combine harvesters is also, on the basis of the preliminary assessment, relatively high.

The FCCA considers it necessary to continue clarifying the competitive effects of the transaction. In its further investigation, the FCCA will examine whether the planned acquisition significantly impedes effective competition in the Finnish market, or a substantial part of it. The FCCA may approve the acquisition as such, attach conditions to the approval or request that the Finnish Market Court prohibit the acquisition. According to the Competition Act, the further proceedings may not take longer than three months.

The FCCA’s decision includes business secrets of the parties involved. The decision cannot be published until the business secrets have been removed.

More information: 
Research Officer Taru-Tuulia Tammi, tel. 029 505 3024,
Senior Research Officer Samuli Muotka, tel. 029 505 3680
firstname.lastname@kkv.fi

According to the Competition Act, the FCCA must be notified of a transaction if the combined turnover of the parties to the corporate transaction exceeds 350 million euros and the turnover from Finland of at least two of the parties exceeds 20 million euros for both. The FCCA will approve a corporate transaction if it has none of the harmful impacts referred to in the Competition Act. The FCCA will intervene in corporate transactions if its investigations suggest that the acquisition substantially impedes effective competition on Finnish markets or a substantial part of the markets, particularly through the creation or reinforcement of a dominant market position. Where necessary, notifications of acquisitions are considered in two stages. The so-called first stage takes a month at most. If the acquisition is clearly not harmful to competition, or if the harmful effects can be prevented by means proposed by the parties to the acquisition, the acquisition is approved during the first stage. If not, the FCCA decides to conduct a further investigation of the matter, during which the acquisition and its competition effects are investigated in further detail.

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