Commission approves proposed acquisition of HRE by Germany's SoFFin

17 May 2009

The Commission concluded that the transaction would not significantly impede effective competition. It is the first time in the current crisis that a bank nationalisation has been notified to the Commission under the EU Merger Regulation.

The Commission approved the acquisition of German financial institution Hypo Real Estate by Germany's state-owned Financial Market Stabilisation Fund. The Commission concluded that the transaction would not significantly impede effective competition in the European Economic Area or any substantial part of it. This is the first time in the current financial crisis that a bank nationalisation has been notified to the Commission under the EU Merger Regulation.

 

The Commission had to assess the proposed transaction under the Merger Regulation, given that the legal provisions of Germany's Financial Market Stabilisation Act and the de facto situation do not ensure that HRE is operated as a separate commercial entity with independent decision-making powers from other state-controlled undertakings after the transaction, in particular, the Kreditanstalt für Wiederaufbau ("KfW").

 

The proposed transaction does not raise any competition concerns.

 

Press release

 

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