German Merger Control: Federal Cartel Office Reviews Increase of Gazprom’s Shareholding in German Energy Company by 1.88% to 10.52%

Sullivan & Cromwell LLP - March 9, 2012
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On 29 February 2012, the German Federal Cartel Office published its decision to approve the increase of Gazprom’s voting rights in the German gas distribution company VNG by 1.88% to 10.52%. The decision illustrates that the Federal Cartel Office will review transactions that result in levels of influence over the target that are far below control and that would not require notification to, and approval by, competition authorities in other jurisdictions. The Federal Cartel Office found that the increase of Gazprom’s share of the voting rights to 10.52% would lead to Gazprom and another minority shareholder in VNG, German oil and gas company Wintershall, having so-called joint competitively significant influence over VNG, thus causing the transaction to require notification to, and approval by, the Federal Cartel Office.