JUNE 3, 2005



 Sun Microsystems, the US computer systems group, has agreed to acquire StorageTek, a...
 The UK government’s plan to sell off the Tote, the government controlled pool-betting
  operator, to the UK horseracing ...
Lamoureux, Director-General for Energy and Transport of the European Commission
   and by Oleh Shamshul, deputy Minister o...
 The European Union could stand to lose US$79bn under a plan being considered by the
  United Nations that would establis...
List of abbreviations

            AE:                  Agence Europe
            DG COMP:             The web-site of the...
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June 3, 2005


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June 3, 2005

  1. 1. JUNE 3, 2005 1. COMPETITION M&A  Sun Microsystems, the US computer systems group, has agreed to acquire StorageTek, a US-based maker of data storage equipment, for US$4.1bn it was reported on June 3, 2005 (FT, June 3, 2005, p. 17)  In an attempt to become the world's largest distributor of liquefied-petroleum gas, Repsol YPF SA, the Spanish-Argentine company, has teamed up with British private- equity firm CVC Capital Partners Ltd on June 2, 2005 to offer about Euro2.5bn for Royal Dutch/Shell Group's LPG assets (WSJE, June 3, 2005, p. A4)  Internet auction company eBay moved into more mainstream areas of online commerce on 2 June, 2005 when it agreed a US$620m cash acquisition of fellow California-based Shopping.com (WSJE, June 3, 2005, p. A4)  Richemont, the Swiss luxury goods group, on June 2, 2005 reversed its acquisition strategy by instead selling its Hackett men’s clothing brand to Torreal, a Spanish investment company, for an undisclosed sum (FT, June 3, 2005, p. 20)  Lawson Software, the US business software company, said it would buy Swedish rival Intentia International in a US$480m all-share deal (FT, June 3, 2005, p. 20)  Gazprom, the Russian energy group, on June 2, 2005 expanded its media business with the purchase of a majority stake of Izvestia, a respected daily newspaper, from Prof- Media, a publishing company owned by the Russian industrial group Interros (FT, June 3, 2005, p. 20)  The following concentrations have been notified to the European Commission: ♦ BP/Nova Chemicals JV (polystyrene and expandable polystyrene) (OJ C136, June 3, 2005, p. 34) ♦ Trimoteur/Fortis/NIBCapital/Sandd (postal mail delivery services) (OJ C136, June 3, 2005, p. 34)  The following concentrations have been cleared by the European Commission: ♦ Barclays/FöreningsSparbanken JV (banking and credit card issuing services) (RAPID, June 3, 2005) ♦ Barclays/IVECO JV (commercial vehicle finance) (RAIPD, June 1, 2005) ♦ CVC/Gilde/Bekaert Fencing (fences) (RAPID, June 1, 2005) ♦ Investcorp/Polyconcept (promotional and gift products) (RAPID, May 31, 2005) State Aid
  2. 2.  The UK government’s plan to sell off the Tote, the government controlled pool-betting operator, to the UK horseracing industry has run into trouble as European regulators opened an investigation on June 1, 2005 over concerns that the sale involves the provision of "substantial” State Aid (FT Online, June 2, 2005)  State support for three shipyards in Gdynia, Gdansk and Szczecin, the three biggest shipyards in Poland, are to be scrutinized in the light of EU Treaty rules on State Aid. On June 1, 2005 , the European Commission announced it was opening formal investigations into Stocznia Szczecinska Nowa Sp.z o.o as well as Stocznia Gdynia S.A and its subsidiary Stocznia Gdanska - Grupa Stoczni Gdynia S.A (EIS, June 2, 2005) Other  The European Commission has granted Siemens, the German industrial conglomerate, three more weeks to receive regulatory approval for its Euro975m bid for the Australian engineering company VA Tech (FT, June 3, 2005, p. 20)  The European Commission announced on June 3, 2005 that its is seeking comments from interested parties on commitments offered by ALROSA and De Beers in a case under EC Treaty rules outlawing cartels and abuse of monopoly power involving the market for rough diamonds. Comments are due by July 3, 2005 (RAPID, June 3, 2005)  Agco, the US maker of farm equipment and owner of the Massey Ferguson brand, is reported to be in talks with China's First Tractor about a joint venture that would make Massey Ferguson tractors in the China for the first time (FT, June 3, 2005, p. 19)  Multiplex, the Australian property giant, is preparing to sell Global Switch, the UK data centre company, but insists there will be no major sell-off of its UK portfolio despite its problems at London's Wembley Stadium (FT, June 3, 2005, p. 18)  The co-chairman and chief executive of US-based Hilton Hotels, has dashed hopes of an imminent merger with Hilton Group, which operates the brand outside the US, indicating he did not envisage a merger or takeover until after December 2007 (FT, June 3, 2005, p. 21)  Constellation Brands, the world's biggest seller of wines, has lined up Citigroup, Merrill Lynch and Bank of America to finance a potential US$14bn counter-bid to Pernod Ricard and Fortune’s bid for Allied Domecq, according to sources close to the matter. Meanwhile Paul Walsh, chief executive of drinks giant Diageo, has said the group would be prepared to help Pernod Ricard in its bid for Allied Domecq though it could also throw its support behind a rival bidder (FT Online & FT, June 2 - 3, 2005, p. 22) 2. TRADE  The European Union on June 2, 2005 formally tabled its revised offer to the World Trade Organization to open up service sectors like postal services, computer and telecommunications services, distribution, environmental services, financial services, tourism and transport services to foreign competition. However, the offer reiterates that the EU will not negotiate any opening of its public sectors like health and education, nor its audiovisual industry (EIS, June 2, 2005) 3. MEDIA / TELECOMMUNICATIONS  Negotiations on Ukraine’s participation in Europe’s satellite radio-navigation program finally reached approval. The agreement was signed on June 3, 2005 in Kiev by François
  3. 3. Lamoureux, Director-General for Energy and Transport of the European Commission and by Oleh Shamshul, deputy Minister of Foreign Affairs of Ukraine (RAPID, June 3, 2005) Please see also under Competition 4. FOOD / CONSUMER POLICY / PHARMACEUTICALS  A new strategy for the European pharmaceutical industry, focusing particularly on boosting innovation and competitiveness, was announced on June 1, 2005 by Günter Verheugen (EU Commissioner for Enterprise and Industry) at a forum organized by the European Federation of Pharmaceutical Industry and Association (EIS, June 2, 2005) Please see also under Competition 5. ENVIRONMENT  To mark the launch of Green Week, organized by the European Commission, and World Environment Day on June 5, 2005, Eurostat published a report on May 31, 2005 showing that EU Member States were still largely reliant on oil products in 2003 with renewable energy sources accounting for less than 6% of energy consumption. However, gas recorded the biggest growth rate at more than 31% between 1995 and 2003 (EIS, June 2, 2005) 6. TRANSPORT / ENERGY  A first agreement between the EU and Ukraine in the field of civil aviation was signed on June 3, 2005 providing European airlines access to the Ukrainian market from any Member State of the EU and making the first step towards the creation of a Common Aviation Area with Ukraine (RAPID, June 3, 2005) Please see also under Competition 7. ENLARGEMENT  Olli Rehn (EU Commissioner for Enlargement) has urged European governments not to turn their backs on future accession candidates Romania and Bulgaria in the wake of the French and Dutch referendum defeats. He called for Member State governments to honor a treaty to admit the two countries and to begin membership negotiations with turkey as scheduled in October 2005 (FT, June 3, 2005, p. 4) 8. OTHER DEVELOPMENTS  The Baltic state of Latvia became the tenth EU Member State to approve the Constitutional Treaty when its parliament voted overwhelmingly in favor of the text on June 2, 2005 (EIS, June 2, 2005)
  4. 4.  The European Union could stand to lose US$79bn under a plan being considered by the United Nations that would establish a new international regime on the patenting of biological resources, claims creative industry lobby the Campaign for Creativity (EIS, June 2, 2005)  National debt is a worry in ten EU Member States according to an annual report adopted by the European Commission on June 1, 2005. The report shows that Belgium, the Czech Republic, Germany, Greece, France, Italy, Cyprus, Hungary, Malta and Slovenia will not be in a position to guarantee long-term stability in their public finances without medium-term budget stabilization (EIS, June 2, 2005)
  5. 5. List of abbreviations AE: Agence Europe DG COMP: The web-site of the Directorate-General for Competition EIS: Europe Information Service (formerly European Report) EV: European Voice FT: Financial Times OJ: Official Journal RAPID: Rapid – The Press and Communication Service of the European Commission WSJE: Wall Street Journal Europe For further information, please contact: Hogan & Hartson L.L.P. View Building, 26 Rue de l’Industrie, 1040 Brussels, Belgium Telephone: [+32 2] 505-0911 ó Fax: [+32 2] 505-0996 http://www.hhlaw.com Catriona Hatton Mariabruna Fimognari Jacqueline Mailly chatton@hhlaw.com mfimognari@hhlaw.com jmailly@hhlaw.com The EU Daily Update is for information purposes only and is not intended as a basis for decisions in specific cases. This information is not intended to create, and receipt of it does not constitute, a lawyer- client relationship. The EU Daily Update is prepared by the Brussels office of Hogan & Hartson L.L.P., where attorneys and advisors assist clients with a broad range of European and national regulatory, competition, trade, telecommunications, corporate, and commercial matters. As a client or contact of Hogan & Hartson L.L.P., we are sending you our EU Daily Update - free of charge - following your request, or because we believe it might be of interest to you. If you no longer wish to receive our EU Daily Update, or any other newsletter distributed by Hogan & Hartson L.L.P., please contact Viviane Corthals at 32 2 505 09 11 or vcorthals@hhlaw.com. Your name and address will be immediately removed from the recipients’ list. In accordance with Belgian data privacy law, we will not share your personal information with third parties without your prior consent. Founded in 1904, Hogan & Hartson L.L.P. is the oldest and the largest major law firm based in Washington, D.C., with more than 900 attorneys serving clients in a practice that cuts across virtually all legal disciplines. In addition to the Brussels office, the firm has international offices in Beijing, Shanghai, Berlin, Budapest*, London, Moscow, Munich, Paris*, Prague*, Warsaw, and Tokyo, as well as U.S. offices in Washington, D.C., New York, Los Angeles, Denver, Boulder, Colorado Springs, Northern Virginia, Baltimore, Miami, Philadelphia, Irvine, McLean, West Palm Beach and White Plains. (*Affiliated Office).