The President of the Office of Competition and Customer Protection (UOKiK) gave his consent to a takeover of Polska Dystrybucja Alkoholi by Eurocash. The transaction may take place providing the purchase of a warehouse in Pabianice is abandoned

Eurocash’s activity concerns mostly wholesale and retail sale of everyday consumer goods, including alcoholic beverages. Polska Dystrybucja Alkoholi (PDA) owns seven specialised warehouses (in Chrzanów, Końskie, Kraków, Pabianice, Radom, Sędziszów and Rusiec), where it sells alcohol. 

Office’s proceedings

The analysis of the concentration clearance request has demonstrated the need to conduct market analysis and to submit the case to the second phase of the proceedings. The Office sent surveys to more than 400 Eurocash’s and PDA’s competitors. Among others, the questions concerned their turnover from the sales of alcohol over the past three years, as well as and the size and the location of their warehouses.

Having examined the obtained data, the UOKiK has issued objections concerning the concentration. Information obtained in the course of the proceedings indicated that the transactions would result in a significant restriction of competition on the local market for the wholesale of beverages with more than 18% alcohol content by specialised warehouses located within 50 km (by road) from the warehouse in Pabianice which is being taken over. Eurocash and PDA are the two companies with the highest shares in this area.

Condition

- UOKiK has decided that it is possible to grant consent to the transaction, providing that Eurocash abandons the purchase of Polska Dystrybucja Alkoholi’s warehouse in Pabianice. This will allow to maintain competition on the local market – says Marek Niechciał, the President of the UOKiK

Exclusion from the transaction concerns all tangible and intangible components which are part of the warehouse specialising in the distribution of alcoholic beverages in Pabianice, including the real estate rights, contracts with suppliers, sales representatives and employees, the warehouse equipment, accounting documentation and the local client base with their purchase history.

Why the local market?

Assuming the local market as the area within 50 km (on roads) from the warehouse which is being taken over is due to the fact that this is the area in which most of the sales by the concentration participants and their competitors takes place. Thus, this is the market on which Eurocash competes with PDA.

When to report concentration?

According to the law, a transaction must be notified to the anti-monopoly office if it involves enterprises whose total turnover in the preceding year exceeded EUR 1 billion globally or EUR 50 million in Poland. While assessing the transaction, the President may give his consent to the concentration or make his consent subject to compliance with additional requirements by the entrepreneur. The issued decisions are valid for the period of two years. This is 23^rd decision since 2004, and fourth decision this year, imposing obligations on the entity reporting the transaction.

The decision issued is not legally valid. The reporting entity is entitled to appeal to Court of Competition and Consumer Protection. At the same time we inform that the website of the Office  provides information on all anti-monopoly concentration proceedings currently conducted by the Office.

Additional information for the media:

The Office of Competition and Customer Protection
pl. Powstańców Warszawy 1, 00-950 Warsaw
Phone: 22 55 60 430
E-mail: biuroprasowe@uokik.gov.pl

Twitter: @UOKiKgovPL