FCCA approves the acquisition of Pohjola Sairaala by Pihlajalinna

On 14 January 2022, the Finnish Competition and Consumer Authority (FCCA) approved in the acquisition of Pohjola Hospital Ltd by Pihlajalinna Terveys Ltd.

Pihlajalinna Group operates extensively in the markets for social and health services in Finland. Pohjola Hospital, which is part of the OP Financial Group, is a specialized provider of orthopaedic and hand surgery services, whose hospitals mainly treat Pohjola Insurance’s insurance customers and customers who acquire the service at their own expense.

According to the FCCA’s investigations, the acquisition does not lead to a significant impediment to competition in the market for health services offered to insurance companies. The capacity of Pohjola Hospital, which previously provided services mainly internally to Pohjola Insurance, will be made more widely available also to other insurance companies, as Pihlajalinna has co-operation agreements with several insurance companies and is actively competing for partnerships. This benefit arising from the acquisition clearly outweighs the potential disadvantages for insurance companies resulting from the improvement in Pihlajalinna’s negotiating position.

The acquisition does not lead to negative effects on services offered to self-paying customers either. The FCCA initiated further proceedings on 2 November 2021, as, based on its initial assessment, the acquisition could have caused negative effects on competition on orthopeadic and hand surgery services purchased by self-paying customers within the hospital districts of Pirkanmaa and Northern Savo. However, the in-depth investigation showed that the market shares of the parties were in fact lower than the preliminary assessment had indicated. In addition, Mehiläinen, one of the parties’ competitors, announced during the investigation that it would open a new health clinic in Tampere.

The in-depth investigations showed that the acquisition will not lead to a significant impediment to competition in any geographical area and that the concentration can be accepted as such.

The FCCA’s decision contains confidential business secrets of the parties. The decision will be made public after the business secrets have been removed.