Horizontal Merger

Mergers and acquisitions - Types of M&A by functional roles in market 1 A horizontal merger is usually between two companies in the same business sector. The example of horizontal merger would be if a health care system buys another health care system. This means that synergy can obtained through many forms including such as; increased market share, cost savings and exploring new market opportunities.

Competition law - Mergers and acquisitions 1 The market shares of the merging companies can be assessed and added, although this kind of analysis only gives rise to presumptions, not conclusions.see, for instance para 17, Guidelines on the assessment of horizontal mergers (2004/C 31/03) The Herfindahl index|Herfindahl- Hirschman Index is used to calculate the density of the market, or what concentration exists

Merger - Types of MA by functional roles in market 1 *A horizontal merger is usually between two companies in the same business sector. The example of horizontal merger would be if a health care system buys another health care system. This means that synergy can obtained through many forms including such as; increased market share, cost savings and exploring new market opportunities.

United States antitrust law - Horizontal mergers 1 *Northern Securities Co. v. United States, horizontal merger under the Sherman Act

United States antitrust law - Horizontal mergers 1 *Horizontal Merger Guidelines (2010)

Mergers and acquisitions in United Kingdom law - Competition law 1 The market shares of the merging companies can be assessed and added, although this kind of analysis only gives rise to presumptions, not conclusions.see, for instance para 17, Guidelines on the assessment of horizontal mergers (2004/C 31/03) Something called the Herfindahl index|Herfindahl-Hirschman Index is used to calculate the density of the market, or what concentration exists

Merger control - Horizontal mergers A horizontal merger is one between parties that are competitors at the same level of production and/or distribution of a good or service, i.e., in the same relevant market|relevant market.^ International Competition Network - Merger Guidelines Workbook, para

Merger control - Horizontal mergers 1 There are two types of anticompetitive effects associated with horizontal mergers: unilateral effects and coordinated effects.

Merger control - Horizontal mergers 1 The likelihood and magnitude of such an increase will instead depend on the substitutability of the products supplied by the two firms – the closer the substitute, the greater the unilateral effects.European Commission - Horizontal Merger Guidelines, para

Merger control - Horizontal mergers As in the case of unilateral effects, the most common form of coordinated effects is in the case of horizontal mergers, i.e

Merger control - Horizontal mergers 1 European Commission - Horizontal Merger Guidelines, para

Merger control - Non-horizontal mergers 1 There are two basic forms of non- horizontal mergers: vertical mergers and conglomerate mergers.^ International Competition Network - Merger Guidelines Workbook, para

Merger control - Non-horizontal mergers 1 In purely vertical mergers there is no direct loss in competition as in horizontal mergers because the parties' products did not compete in the same relevant market

Merger control - Non-horizontal mergers 1 Vertical effects can produce competitive harm in the form of foreclosure. A merger is said to result in foreclosure where actual or potential rivals' access to supplies or markets is hampered or eliminated as a result of the merger, thereby reducing these companies' ability and/or incentive to compete.European Commission Non-Horizontal Merger Guidelines, para lex.europa.eu/LexUriServ/LexUriServ.do?uri= OJ:C:2008:265:0006:01:EN:HTML

Merger control - Non-horizontal mergers 1 Two forms of foreclosure can be distinguished. The first is where the merger is likely to raise the costs of downstream rivals by restricting their access to an important input (input foreclosure). The second is where the merger is likely to foreclose upstream rivals by restricting their access to a sufficient customer base (customer foreclosure).European Commission Non- Horizontal Merger Guidelines, para lex.europa.eu/LexUriServ/LexUriServ.do?uri= OJ:C:2008:265:0006:01:EN:HTML

HMV - Australia 1 The horizontal merger was approved by the Australian Competition and Consumer Commission|ACCC that same month leaving Brazin to merge marketing and general operations within the one entertainment division

Williamson trade-off model 1 The 'Williamson trade-off model' is a theoretical model in the economics of industrial organization which emphasizes the trade-off associated with horizontal mergers between gains resulting from lower marginal cost|costs of production and the losses associated with higher prices due to greater degree of monopoly power.Robert Beynon, [ 9lpg=PA349dq=Williamson+trade+off+modelsource=blots=2E zE7a9bfwsig=B1AVpfWqnzC70fm35GJso3iNedQhl=enei=TG JNS-- gM5X2NYWx2O4Msa=Xoi=book_resultct=resultresnum=10ve d=0CCkQ6AEwCQ#v=onepageq=Williamson%20trade%20off %20modelf=false The Routledge critical dictionary of global economics], Taylor Francis, 1999, p

Williamson trade-off model - Basic idea of the model 1 More generally however, a horizontal merger can involve both costs and benefits.

Herfindahl index - Example Guidelines on horizontal mergers So to take the example, if in market X company B (with 10% market share) suddenly bought out the shares of company C (with 10% also) then this new market concentration would make the index jump to

Merger guidelines - History of the Merger guidelines 1 Dick, The Merger Guidelines and the Integration of Efficiencies into Antitrust Review of Horizontal Mergers, 10 June 2002]

Merger guidelines - History of the Merger guidelines 1 The 1997 Horizontal Merger Guidelines were replaced with the most recent version in This version was released on August 19, 2010.[ g.pdf 2010 Horizontal Merger Guidelines] The 2010 Guidelines introduced the concept of upward pricing pressure resulting from a merger between competing firms.

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