The Italian Competition Authority starts a phase II investigation into a baby products merger

The Italian Competition Authority (ICA) has recently opened a phase II investigation into a merger in the retail markets for baby products (Case C11982, EnricoPreziosi-Artsana/Newco-Bimbo Store). The notified concentration includes a number of connected transactions, by which Bimbo Store (BS) is purchased by Giochi Preziosi (GP), which is purchased by Enrico Preziosi. Then, GP and Artsana create a new company (Newco) to which GP, BS and Artsana, holder of the mark Chicco, transfer their baby products retail activities.
In the ICA view the notified concentration may have horizontal and vertical anticompetitive effects. To start with, the ICA identified the relevant product markets that appeared to be affected by the concentration in the retail markets for baby products. This market is local in scope with each province being a relevant geographic market. Baby products include a wide range of products which are distributed through several channels, among which, the Baby Store format. This format accounts for the most important retal channel of the so called Juvenile category of baby products (for example prams, bags and beds). The ICA tabled the possibility that the relevant product market could be narrowed down to the Baby Sore retail market in which the combined market shares of the merging parties in the Baby Store retail market are higher than 40% in many provinces. The merging parties submitted that the Baby Store shops also face competition exerted by the other distribution channels for baby products and hereby the relevant product market should be extended to these activities as well. However, the ICA disagreed on that. It replied that the peculiarities of each distribution channel should be considered. In particular, bearing in mind that the Baby Store channels is important only for some categories of bany products, it argued that only a Baby Store shop might exert a credible competition on another Baby Store shop.
Finally, because the merging parties are vertically integrated operators active both in the manufacturing and retailing of the baby products, the ICA investigations also focus on the vertical effects of the concentration.


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