GERMANY Trends and Developments Contributed by: Andreas Rosenfeld and Sebastian Steinbarth, Redeker Sellner Dahs
In its examination of the takeover of almost all employees of the technology company Inflec - tion AI Inc. by Microsoft, the FCO agreed with the European Commission’s view that the takeo - ver of employees together with accompanying agreements on financing and the use of intel - lectual property rights is in principle subject to (German) merger control as a so-called acqui- hire. In the opinion of the FCO, the acquisition of highly qualified employees with special know- how ultimately transfers the competitive poten - tial of a target company to the acquirer. In the end, however, the FCO came to the conclusion that the relevant revenue and transaction value thresholds were not met. In a recap of his outlook for 2025, FCO President Andreas Mundt echoed many sentiments from the Draghi report on European competitiveness published in September 2024 and called for a strong competition regime and a vigorous com - petition policy as a key to ensure European com - petitiveness. In his view, merger control is and will remain the most important tool to maintain a competitive environment, as it is the only way to prevent the emergence of market power and to avoid having to monitor companies’ behaviour after the merger, especially regarding the acqui - sition of start-ups in the AI sector. “Killer Acquisitions” and the Transaction Value Threshold In its efforts to control so-called “killer acquisi - tions”, the FCO is placing increasing importance on the transaction value threshold for merger control, which was introduced in 2021. It ena - bles the FCO to review transactions in which high purchase prices above EUR400 million are paid even though the parties do not reach the traditional revenue thresholds. In this context, ”killer acquisitions” refer to transactions in which innovative and research-intensive companies
are acquired in novel growth markets to remove the technologies they offer from the market and prevent the emergence of rivals. In December 2024, FCO President Andreas Mundt specifi - cally mentioned the acquisition of innovative AI start-ups as a particularly important use case for merger control. 2024 saw the first Phase II investigation into a merger caught by the transaction value thresh - old, namely the acquisition of the Swedish bio - tech company Olink by the US Thermo Fisher Scientific Inc. Thermo Fisher Scientific Inc. is a supplier of laboratory consumables and analyti - cal technology, while Olink provides analytical systems and services in the field of proteom - ics. Even though the revenue thresholds were not met, the transaction was notifiable due to the purchase price of approximately EUR2.8 bil - lion and the considerable activity in Germany. Ultimately, the FCO cleared the transaction as it assumed different markets due to different cus - tomer groups. The takeover of the artificial heart valve manu - facturer JenaValve by Edwards Lifesciences Cor - poration was also initially reviewed by the FCO on the basis of this transaction value threshold. However, at the beginning of 2025, the Office came to the conclusion that there was no obli - gation to notify due to the low level of activity in Germany. Call-In Powers and Merger Review Below Jurisdictional Thresholds Beyond the transaction value threshold, the FCO is generally critical of extending merger control to transactions below the turnover thresholds. This applies in particular to instruments such as “call-in powers”, which give antitrust authorities discretion to review any transaction irrespective of revenue or transaction value thresholds. The
236 CHAMBERS.COM
Powered by FlippingBook