Framatome, Siemens Venture Faces Extended EU Probe

["Sandy Perle" <sandyfl@earthlink.net>]

Framatome, Siemens Venture Faces Extended EU Probe
  
Brussels, Aug. 11 (Bloomberg) -- Framatome SA, the world's largest 
maker of nuclear power stations, and Siemens AG face up to four more 
months of antitrust scrutiny of their plans to merge nuclear 
activities, the European Commission decided today. 

The commission, the regulatory authority of the 15-nation European 
Union, opened a so-called ``second-phase investigation'' into the 
plan, citing concerns about its ``strong positions on certain nuclear 
technology markets.'' 

Only about 10 percent of merger applications are subjected to 
additional scrutiny, which usually means companies have to divest 
assets in order to alleviate antitrust concerns. 

Framatome of France and Germany's Siemens announced the plan the 
units last December, expecting the venture to have annual sales of 
3.1 billion euros ($2.8 billion). The venture, two-thirds owned by 
Framatome and one-third by Siemens, was expected to start business in 
the third quarter of this year. 

The joint venture will affect certain nuclear technology markets, in 
particular the design and manufacturing of fuel assemblies, 
instrumentation and control systems and the replacement and 
installation of nuclear power plant components, the commission said. 

``The concern is that the new entity would have substantial market 
shares'' in Europe, the commission said. ``The Commission, therefore, 
has serious doubts about the operation's compatibility with the 
common market.'' 

Following delays in preparing legal documents and signing final 
agreements, the venture is now expected to start running in the 
fourth quarter, Framatome said. 

Today's EU decision was not a surprise, the company said. 

``This follows a totally normal procedure,'' said Framatome 
spokeswoman Brigitte Guillemette. ``We expected there to be this 
complementary phase'' of investigation. 

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Sandy Perle					Tel:(714) 545-0100 / (800) 548-5100   				    	
Director, Technical				Extension 2306 				     	
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