THE Philippine Competition Commission (PCC) said that it has cleared the acquisition of Japan’s INFRONEER Holdings, Inc.’s of Sumitomo Mitsui Construction Co., Ltd.
“In its review, the PCC found that the two companies do not have horizontal overlaps — that is, they do not operate in the same line of business — and no vertical relationships, such as one company supplying goods or services to the other,” the PCC said in a statement sent over the weekend.
INFRONEER plans to acquire Sumitomo through a public takeover bid.
INFRONEER is involved in infrastructure services, while its subsidiaries are involved in construction, paving, manufacturing, and construction machinery sales.
According to the PCC, INFRONEER does not have direct construction operations in the Philippines.
“Because of this, the Commission concluded that the transaction is unlikely to result in a substantial lessening of competition in the local construction and infrastructure sector,” it added.
Sumitomo Mitsui Construction is active in Philippine infrastructure projects funded by Japanese official development assistance.
Its completed projects in the Philippines include the Taganito Hydrometallurgical Processing Plant Project, the Agas-Agas Bridge Project, and the Northern Negros Geothermal Power Plant.
It is also involved in the Metro Manila Subway Project and the North-South Commuter Railway Project.
“This assessment is part of the PCC’s mandate to ensure that mergers and acquisitions do not harm competition, restrict consumer choice, or hinder innovation in Philippine markets,” the PCC said.
“The PCC can also review transactions involving foreign entities if these meet the notification thresholds under the Philippine Competition Act,” it added.
If realized, the transaction will make Sumitomo Mitsui Construction a wholly owned subsidiary of INFRONEER along with Maeda Corp., Maeda Road, Maeda Seisakusho, and Japan Wind Development.
According to a notice dated May 14, the company aims to start the process of business integration in December. — Justine Irish D. Tabile