Decision Nº M/04/055 from Competition and Consumer Protection Commission, 2004-10-15

CourtCompetition and Consumer Protection Commission (Ire)
PartiesB.I.C. Systems Group,British Telecommunications
Decision Date15 October 2004
Date15 October 2004
StatusPreliminary investigation (Phase 1)
Decision NumberM/04/055
Determination of the Competition Authority
Determination No. M/04/055 of the Competition Authority, dated 15
Notification No. M/04/055 –The proposal by British Telecommunications
plc to acquire B.I.C. Systems Group Limited
Introduction
1. On 22 September 2004 the Competition Authority, in accordance with Section
18 (1) of the Competition Act, 2002 (“the Act”) was notified, on a mandatory
basis, of a proposal whereby British Telecommunications plc (“BT”) would
purchase the entire issued share capital of B.I.C. Systems Group Limited
(“B.I.C.”). The notified transaction is hereinafter described as “the proposed
acquisition”.
The Parties
2. BT, a subsidiary of BT Group plc, has international presence. It is principally a
supplier of telecommunications services, high-end broadband and Internet
products and services, and information technology (“IT”) solutions. A BT
subsidiary, Esat Telecommunications Limited, trades as Esat BT and supplies
telecommunications products and services in the State.
3. B.I.C., the target, is based in Northern Ireland. B.I.C. supplies information
communications technology (“ICT”) products and services in the UK, Northern
Ireland and the State (through a Dublin-based subsidiary, B.I.C. Systems
(IRL) Limited).
Analysis
4. Esat BT principally provides telecommunication products and services in the
State: any IT services it provides are described as being incidental to its main
activity. B.I.C operates in three main sectors in the State: supply of IT
hardware and software (about €[…] annual turnover); IT consulting and
managed services (about €[…] annual turnover); and IT training (about €[…]
annual turnover). The parties therefore operate in distinct business sectors
in the State, though those sectors could possibly be described as segments of
an overall IT and telecommunications industry.
5. The commercial rationale of the proposed acquisition is focused on Northern
Ireland, where the parties overlap in the supply of IT services and solutions.
BT’s Northern Ireland division (“BTNI”) supplies a range of IT services to
corporate and public sector customers, as does the target. Post-acquisition,
BTNI would acquire skilled B.I.C personnel and could offer a wider portfolio of
IT services to customers in Northern Ireland.
6. Unlike the situation in Northern Ireland, there is minimal overlap between the
parties’ business activities in any industry for goods or services in the State.
Therefore the proposed acquisition would not substantially increase
concentration in any industry in the State.
Determination
The Competition Authority, in accordance with Section 21(2) of the Competitio n
Act, 2002, has determined that, in its opinion, the result of the proposed
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