On June 29, 2015, the European Commission unconditionally approved the $7.8 billion acquisition by Siemens of Dresser-Rand after an in-depth (“Phase-II”) investigation. The transaction between one of the world’s largest industrial firms (Siemens) and one of the leading manufacturers of rotating equipment (Dresser-Rand) had already been cleared by several competition agencies around the world, including among others the U.S. Department of Justice and the Chinese MOFCOM. The antitrust agencies focused their attention on the potential competitive effects of combining the parties’ supply of turbo compressors and aero-derivative gas turbines (“ADGTs”) used in the oil and gas industry. In particular, the antitrust agencies were concerned that the transaction would reduce the number of competitors from three main suppliers (market leader General Electric, Siemens/Rolls-Royce and Dresser-Rand) to two. Compass Lexecon submitted various empirical and theoretical analyses of horizontal effects and vertical foreclosure, as well as several analyses of bidding data, showing, among other things, that the parties catered to different segments of the oil and gas industry and therefore did not often bid directly against each other. A transatlantic Compass Lexecon team led by Jorge Padilla, Thilo Klein and Enrique Andreu in Europe, and Jon Orszag, Guillermo Israilevich and Wei Tan in the United States supported Siemens during the multi-jurisdictional filing. Compass Lexecon worked with Michael Egge, Lars Kjølbye, Sven Völcker and Héctor Armengod of Latham & Watkins LLP; Frank Montag and Sascha Schubert of Freshfields Bruckhaus Deringer LLP; and Sean Boland and Paul Lugard of Baker Botts LLP.
- Antitrust & Competition: Mergers