Avoiding competition formalities and accelerating purchase strategy, Editions Odile Jacob SAS, C-551/10 P

On 06/11/2012 the Grand Chamber of the European Court of Justice confirmed the wisdom of Lagardère SCA strategy for accelerating purchase of another company despite the presence of anti-concentration formalities. Vivendi Universal put on the table an urgent proposal to buy Vivendi Universal Publishing SA, a book publishing business in Europe and Latin America except Brazil. Lagardère didn’t have time to get clearance for this step from the competition authorities. So the decision was taken that the Vivendi Universal Publishing would be bought by Investima 10 wholly owned by Ecrinvest 4 SA wholly owned by Segex SARL wholly controlled by Natexis Banques Populaires SA (§ 2).

It was agreed that after getting clearance from the European Commission, Natexis Banques Populaires would sell the target assets back to Lagardère (Article 3(2)(i) of the NBP/ Lagardère sale contract, § 12).

Lagardère's competitor Editions Odle Jacob attacked this operation arguing that the transaction as a whole hiding the ultimate purchaser with a provisional one should be annulled (§ 26). The Natexis Banques Populaires subsidiaries created for the sole purpose of this transaction were not independent but bound vis-à-vis Lagardère by a contract (§ 27). The ECJ replied that the arrangement did not affect the very legality of the purchase (§ 34). It might lead to penalties but not to annulment of the transaction (§ 38).