The European Commission said on Wednesday that it will block the merger of Alstom and Siemens, preventing France and Germany from realizing their dream of creating a European rail champion.
Brussels concluded that the deal is “incompatible” with the internal market and that it would harm competition in markets for railway signaling systems and high-speed trains.
In November, the EU competition authorities raised a number of issues in the charge sheet. The two companies did not manage to assuage those worries in the remedies they offered.
“The Commission prohibited the merger because the companies were not willing to address our serious competition concerns,” Competition Commissioner Margrethe Vestager said in a press release.
Canada’s Bombardier said it is “pleased” with the decision, for the merger “would have severely undermined the health and competitiveness of the whole European rail market, leaving European consumers, both as rail users and tax payers, to pay the price,” said Daniel Desjardins, the company’s general counsel.
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In recent weeks, France and Germany criticized the Commission’s plan to block the mergers and called for a reform of European competition rules to allow for the creation of European champions.
At a conference this morning, ahead of announcing the prohibitions, Vestager emphasized the need for a Europe with “a strong industrial strategy. A strategy that builds on — but also goes beyond — our single market.”
Brussels also announced Wednesday that it will not approve the acquisition of German copper producer Aurubis by German copper products maker Wieland-Werke.