The Bundeskartellamt has cleared plans by Alloheim Senioren-Residenzen SE (Alloheim) to acquire the Katharinenhof group in the first phase of merger control. The Katharinenhof group is currently owned by Deutsche Wohnen SE.

Düsseldorf-based Alloheim operates 262 senior citizens’ homes and nursing homes across Germany as well as 95 assisted living facilities. It is a subsidiary of Nordic Capital, a Swedish holding company. The Berlin-based Katharinenhof group operates a total of 23 nursing homes in six federal states – Berlin, Brandenburg, Hamburg, Lower Saxony, Saxony and Thuringia – and offers assisted living services in seven locations. Both parties also offer day care and outpatient care services.

Andreas Mundt, President of the Bundeskartellamt: “Our examination of the present case has shown that there are numerous local providers in all service areas affected. The project does not raise any concerns under merger control rules. However, while Germany has many nursing homes and nursing home places on paper, finding a place in a nursing home is very difficult in many regions. This is not due to a lack of competing providers but due to a great shortage of staff necessary to use the existing capacities. At the same time costs are rising, as well as the proportion of costs care recipients must contribute themselves. In this area which is essential in our ageing society, the positive effects competition usually has cannot sufficiently materialise. Ultimately, the issue can only be addressed by setting a policy framework.”

Germany has well more than 10,000 nursing homes with more than 900,000 nursing home places. Inpatient and outpatient care services are provided by either non-profit organisations (such as churches or non-statutory welfare organisations) or private companies. The number of public nursing homes, usually owned by municipalities, is comparatively low (well less than 10 per cent of all nursing homes and nursing home places in Germany).

In all regions affected by the notified acquisition there are numerous alternative providers of full-time inpatient care services. The merger also raises no competition concerns with regard to assisted living and outpatient care services. The acquiring company, Alloheim, is a large provider active across Germany. However, the investigations have shown that at the regional level market share additions will be so insignificant that the merger will have no relevant effect on competition.

The properties used by the Katharinenhof group for the provision of nursing care and assisted living services are not part of the notified transaction. Deutsche Wohnen SE intends to sell them in a separate transaction to Civitas Investment Management. This transaction has been notified to the Bundeskartellamt and is currently being examined.