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IP/02/311 Brussels, 25 February 2002 Commission approves takeover of Schöller by Nestlé The Commission has approved the takeover of the German Schöller Group by the Swiss company Nestlé S.A. It examined the impact of the merger on the ice-cream market in Germany, the Netherlands, Austria and France but concluded that it would not give rise to any concerns, especially given the competition from Unilever Plc, which would remain the number one ice-cream manufacturer in Europe and worldwide. Schöller Holding Group is a company based in Nuremberg, Germany, which manufactures and markets ice cream and frozen foods, primarily in Germany. It has an exclusive licence for the sale of Mövenpick in several European countries. Nestlé is the parent company of a multinational food and beverages group based in Vevey, Switzerland, which plans to buy Schöller from Südzucker. During its investigations, the Commission found that there were overlaps on the ice-cream market between the activities of Schöller and Nestlé and that the transaction would strengthen Nestlé's position in this sector in several countries. However, Unilever Plc would remain the European and worldwide leader, and competition would remain strong. The Commission's investigations focused on the following markets: - "impulse" ice cream (for consumption in public establishments and at leisure events) in Germany, France, the United Kingdom, the Netherlands and Austria; - catering ice cream (for consumption in restaurants, cafés, etc.) in Germany, France, the United Kingdom, the Netherlands and Austria; - "take-home" ice cream (sold via food retailers to private households) in France and Germany; - ice cream manufactured for secondary brands in Germany. The Commission's investigations into the "impulse" ice-cream market revealed that the merger would not lead to any significant change in the situation with regard to competition. Once the transaction has been completed, Nestlé will be the number two manufacturer on all of the relevant national markets, but Unilever will remain the uncontested leader in this sector, with much larger market shares than those of Nestlé/Schöller. With regard to catering ice cream, Nestlé/Schöller will take over the number one spot from Unilever in the Netherlands. However, a number of independent wholesalers responsible for a large proportion of distribution operate alongside the large manufacturers in that country. Some of them are also vertically integrated with food retailers and are increasingly offering their own brands, including on the catering market. In Germany Schöller's leading position ahead of Unilever will be slightly improved as a result of the merger. However, the two companies compete intensely with each other, and Nestlé's position in Germany is relatively weak. Consequently, it is unlikely that Nestlé/Schöller will achieve an individual dominant position or that Nestlé/Schöller and Unilever will achieve a combined dominant position. In Austria and France Nestlé will occupy second place on the catering ice-cream market after the merger. However, Unilever will continue to be the undisputed market leader, with much larger market share than Nestlé/Schöller. In the case of "take-home" ice cream, the combined market shares of Nestlé/Schöller in France and Germany will be insignificant. Even after the merger, it will remain below 20% in both value and volume terms. Unilever is the market leader in both countries, with much larger market shares, and the share of secondary brands is also substantial, especially in Germany. Finally, with regard to ice cream sold under distributors' brands in Germany, the Commission takes the view that there will be sufficient competition, especially given the market power of the large food retailers. 2