The planned merger between Cargotec and Konecranes has been blocked by the UK’s Competition & Markets Authority (CMA). As a result, the boards of directors of Cargotec and Konecranes have concluded that it is in the best interest of companies and their respective shareholders that the merger is cancelled.
Cargotec and Konecranes will immediately cease the pursuit of the merger and the related processes and continue to operate separately as fully independent companies.
According to the CMA’s final report, the remedies proposed by the companies, which would have removed all overlapping businesses of the two companies and which were accepted by the European Commission, would not be effective in addressing the CMA’s concerns and thus the planned merger between Cargotec and Konecranes cannot be completed as the completion of the planned merger would have required approvals from all relevant competition authorities.
Cargotec points out that the planned merger had already obtained clearances from numerous competition authorities including the State Administration for Market Regulation (the competition authority in China) and nine other jurisdictions.
Ilkka Herlin, the chairman of Cargotec stated, “The Board of Cargotec is convinced that the merger would have created substantial value for the entire industry as well as shareholders by improving sustainable material flow. The combination would have created a strong European company enabling accelerated shared abilities to innovate without harming competition. We have done all we could to realise the merger and are disappointed that our plans have had to be abandoned. After a long and extensive regulatory review process and merger planning preparations it is time to shift our full focus on executing Cargotec’s own strategy and value-creation opportunities.”
