Eu Statement On Guinness/Gdmet Deal Today

The European Commission will announce on Friday whether it has decided to clear or start a full probe into the proposed merger of drinks groups Guinness Plc and Grand Metropolitan Plc. EU sources said a press statement would probably be released late on Friday afternoon rather than after the Commission's daily noon briefing.

The EU executive usually reserves late announcements, which are issued after the relevant equities markets have closed, for decisions to initiate in-depth investigations into mergers or acquisitions which it fears may harm competition.

Friday is the deadline to rule on the deal after the two companies filed for EU regulatory approval on May 16.

 

The sources gave no hint of the Commission's intentions, saying that the merger task force had not yet proposed a decision to European Competition Commissioner Karel Van Miert.

Van Miert himself declined to comment on the issue on Tuesday, but noted that the task force was having a hard time defining the relevant products and geographical markets concerned.

A full probe would take up to four months. Lawyers well versed in EU competition law have speculated that the 23-billion-sterling deal will require a thorough investigation because of its sheer size and the structure of the European spirits market.

The merger would form the world's leading spirits and wine company. bringing together brands such as GrandMet's Smirnoff vodka, J&B whisky and Bailey's with Guinness-owned Johnnie Walker and Bell's Scotch whisky and Gordon's gin.