In its press release on March 17, 2014, the Korea Fair Trade Commission (the “KFTC”) blocked the proposed acquisition of 50% shares by Essilor Amera Investment Pte. Ltd. (a subsidiary of Essilor International S.A., the largest optical lens maker in the world) in Daemyung Optical Co., Ltd. (the second largest optical lens maker in Korea) citing inter alia the likely lessening effect on price competition and the probable future abuses of the enhanced market power. On top of the expressed
competitive concerns, the KFTC observed that allowing foreign firms to acquire local firms and turn them into their local sub-contractors worsens the competitive market structure of the domestic optical lens industry.
This was the first case in which the KFTC blocked a proposed combination since 2007 (when the KFTC blocked the business transfer deal between Owens Corning and Saint-Gobain Vetrotex for the latter’s business of the glass fibre reinforcements and composite fabrics) and also the very first case in which an acquisition of a Korean firm by a non-Korean firm was blocked in Korea.
- Factual Backdrop of the Proposed Combination
- The KFTC Blocks the Proposed Combination
- Remarks on the KFTC Decision