ASL’s acquisition of Arianespace cleared by the EC, subject to conditions

Laurent Flochel

Following an in-depth investigation, the European Commission has approved ASL’s acquisition of satellite launch service provider Arianespace, subject to conditions. 

ASL is a 50/50 joint venture controlled by Airbus and Safran, and manufactures the Ariane launcher used to launch satellites.  The transaction has both vertical and conglomerate aspects as Airbus is a major satellite manufacturer.  The parties have agreed to firewalls and employee mobility restrictions to address the Commission’s concerns relating to flows of information between Arianespace and Airbus.  The economic analysis of the transaction focused on the concern that the merged firm would be able to use pricing strategies (such as mixed-bundling) to foreclose Airbus’ rivals on the satellite market and to reduce their incentives to invest and innovate. To help  assess this concern CRA provided an extensive analysis of the competition on the market for launches, which demonstrated the increasing competitive pressure exerted on Arianespace notably by Space X, and developed a model of mixed bundling incorporating various existing cross shareholdings between the firms.  The Commission cleared the transaction without  requiring any remedies relating to this theory of harm.

A team including Laurent Flochel, Damien Neven, Uğur Akgün and Guillaume Débarbat advised the parties on the transaction.

See the EC’s press release for further details here.