Considering intervention in Elkjøp’s acquisition of Eplehuset

The Norwegian Competition Authority is considering prohibiting Elkjøp’s acquisition of Eplehuset, as the transaction may lead to reduced competition in the sale of Mac and iPad devices to consumers.

Elkjøp Nordic AS and Hovedhuset AS (Eplehuset) are both retailers of Apple products and sell, among other things, Mac and iPad devices. The companies currently compete in sales to private customers through both physical stores and online channels.

– We are concerned that reduced competition may lead to higher prices, less choice and poorer service for customers, and have therefore notified the parties that we are considering intervening against the acquisition, says project manager Johannes Hjartlie.

The Norwegian Competition Authority notes that Elkjøp already holds a strong position in the sale of consumer electronics and that, through the acquisition of Eplehuset, it will further strengthen its position, particularly in the sale of Mac and iPad devices to private customers.

– Taken together, Elkjøp and Eplehuset would become by far the largest player in the sale of Mac and iPad devices to consumers, and the concentration in the market would increase significantly as a result of the transaction, says Head of Section Marita Mæland Skjæveland.

The Authority considers the parties to be close competitors, particularly in the sale of Mac and iPad devices. In addition, the Authority finds that there are high barriers to entry for new competitors seeking to establish themselves in the market.

The Norwegian Competition Authority is particularly concerned that the acquisition would eliminate the competitive pressure between two close competitors. The Authority considers that the transaction could lead to fewer choices for customers, especially in areas where both companies operate physical stores. Eplehuset currently exerts an important competitive constraint on Elkjøp, among other things by offering specialized expertise and customer advice in the sale of Mac and iPad devices. Following the acquisition, this competitive constraint would be removed.

The Norwegian Competition Authority emphasizes that this notice does not constitute a final decision. Under the Competition Act, the parties now have 15 working days to submit their comments on the Authority’s assessment. The Authority then has 15 working days to adopt a final decision in the case.