Tag: Manufacturing

NXP Semiconductors N.V. agreed to sell its RF power amplifier assets in order to settle charges that its proposed $11.8 billion acquisition of Freescale Semiconductor Ltd. would substantially lessen competition in the worldwide market for RF power amplifiers, likely resulting in higher prices and reduced innovation. The proposed consent order preserves competition by requiring NXP to divest all its assets that are used primarily for manufacturing, research, and development of RF power amplifiers to the Chinese private equity firm Jianguang Asset Management Co. Ltd. These assets include a manufacturing facility in the Philippines, a building in the Netherlands to house management and some testing labs, as well as all patents and technologies used exclusively or predominantly for the RF power amplifier business, and a royalty-free license to use all other NXP patents and technologies required by that business. The divestiture also includes all of NXP’s RF power amplifier employees and managers.

As part of a settlement, The Coca-Cola Company agreed to restrict its access to confidential competitive business information of rival Dr Pepper Snapple Group as a condition for completing Coca-Cola’s proposed $12.3 billion acquisition of its largest North American bottler, which also distributes Dr Pepper Snapple carbonated soft drinks. In a complaint filed with the settlement, the FTC charged that access to cmmercially sensitive information likely would have harmed competition in the U.S. markets for carbonated soft drinks.Under the settlement with the FTC, Coca-Cola will set up a “firewall” to ensure that its ownership of the bottling company does not give certain Coca-Cola employees access to commercially sensitive confidential Dr Pepper Snapple marketing information and brand plans.

Two of the world’s largest auto parts suppliers, ZF Friedrichshafen AG and TRW Automotive Holdings Corp., agreed to divest TRW's linkage and suspension business in North America and Europe, to settle FTC charges that their proposed $12.4 billion merger would likely harm competition in the North American market for heavy vehicle tie rods. Under the consent agreement, the combined company is required to divest TRW’s North American and European linkage and suspension business for heavy and light vehicles (which includes heavy vehicle tie rods). The business includes five manufacturing plants in Michigan, Canada, the Czech Republic, and Germany, and leased space in a research and development lab in Germany. At the divestiture buyer’s request, ZF must provide transition services for logistical and administrative support as well as transitional supply agreements for key manufacturing inputs needed to fulfill existing customer contracts.

Tobacco companies Reynolds American Inc. and Lorillard Inc. agreed to divest four cigarette brands to Imperial Tobacco Group to settle FTC charges that their proposed $27.4 billion merger would likely be anticompetitive. The order requires Reynolds to divest to Imperial four established cigarette brands: Winston, Kool, Salem, and Maverick. Imperial is an international tobacco manufacturer with a competitive presence in about 70 countries, but a comparatively small presence in the United States. With the acquisition of the divested assets, Imperial would become a more substantial competitor in the United States. The Commission’s order requires not only that the brands be divested, but also that Reynolds divest to Imperial the Lorillard manufacturing facilities in Greensboro, North Carolina, and provide Imperial with the opportunity to hire most of the existing Lorillard management, staff, and salesforce. It also requires the newly merged Reynolds and Lorillard to provide Imperial with retail shelf space for a short period, and to provide other operational support during the transition.

The Commission challenged major consumer electronics manufacturers Panasonic Corporation's proposed $9 billion acquisition of Sanyo Electric Co., Ltd., requiring that Sanyo sell its portable nickel metal hydride (NiMH) battery business related assets, including a premier manufacturing plant in Japan. NiMH batteries power two-way radios, among other products, which are used by police and fire departments nationwide.