Landline phones: VTech can take over significant assets from Gigaset

The Bundeskartellamt has cleared the planned acquisition of significant assets of Bocholt-based Gigaset Communications GmbH (Gigaset) by Snom Solutions GmbH (Snom), which belongs to the VTech Group, within the one-month period in the first phase of merger control. Both Gigaset and VTech operate in the landline phone business.

Gigaset is under debtor-in-possession management within the framework of insolvency proceedings. Snom is a wholly-owned subsidiary of VTech Holdings Limited, Bermuda, (listed at the Hong Kong Stock Exchange).

Andreas Mundt, President of the Bundeskartellamt: “When it comes to landline phones for household use, Gigaset has very high market shares. Overall demand in this industry is declining. We carefully examined this merger, but ultimately we have no serious competition concerns about the project.

In Europe Gigaset and VTech mostly operate on different market levels of the home phone business. There are some overlaps in their activities in the landline phone business for professional use, but there is a sufficient number of alternative suppliers.”

Gigaset sells landline phones under its own brand to resellers and final customers. Suppliers competing with Gigaset in this business include Panasonic and AVM. For the European market VTech primarily produces phones on behalf of and according to the specifications of third-party suppliers, a market in which Gigaset is not active. While the activities of the parties directly overlap in the area of landline phones for professional use, the investigations showed that there is a sufficient number of alternative suppliers, for example Mitel, RTX and Ascom Wireless.

The project is not expected to significantly impede effective competition. The Bundeskartellamt has cleared the acquisition in the first phase of merger control.