The Competition Authority approved the acquisition of Olíuverzlun Íslands hf. (Olís) by Hagar hf. and of the real estate company DGV hf. by Hagar, on the basis of a settlement with Hagar on 11 September 2018. The merger was subject to detailed conditions, which were intended to remove the resulting competition barriers. These included commitments by Hagar to sell three of its grocery stores, the grocery section of the Olís store in Stykkishólmur, and five Olís petrol stations. The settlement and a more detailed discussion of it can be found in News of the Competition Authority of 11 September 2018.
The implementation of the merger between Haga and Olís was subject to the condition that a qualified buyer was found for all the assets offered. The agreement stipulates that the purchasers must meet certain conditions, which include, amongst other things, that they are capable and likely to provide Haga and other competitors with significant competitive restraint.
In connection with the settlement, Hagar entered into an agreement with Atlantic Oil regarding the purchase of the aforementioned petrol stations and, on the other hand, a contract with Iceborg Ltd. regarding the purchase of the three convenience stores, as well as Olís's convenience store in Stykkishólm.
Based on the aforementioned agreement, an independent expert was tasked with assessing the purchasers of the assets with whom Hagar has entered into agreements. The expert deemed both of the aforementioned purchasers suitable.
Following further investigation, the Competition Authority agreed that Atlantic Oil fulfilled the conditions of the settlement. In light of the opinion of the expert and certain other matters concerning eligibility Ice-cream As a potential purchaser, the Competition Authority requested detailed information from the company on various matters relating to the fitness assessment. Following that review, the Competition Authority concluded that Iceburg did not meet the requirements for the buyer's eligibility for the properties, at least as of now.
Subsequently, the Competition Authority was again asked to assess the suitability of Ísborg. The parties undertook specific improvements based on the comments made in the Competition Authority's decision. In light of the corrections made by the contracting parties, as well as their additional commitments, the Competition Authority has now assessed Ísborg as a qualified purchaser for the purposes of the settlement.
One of the matters considered by the Competition Authority and an independent expert was the independence of Ísborg in relation to Hagar, particularly due to the connection between Ísborg's representative and an indirect shareholder in Hagar. In the opinion of the Competition Authority, the said connections do not preclude the transaction, in light of the assumptions on which they are based.
In light of the foregoing, the merger parties are now permitted to carry out the aforementioned merger of Haga and Olís.
The Competition Authority will publish a decision in the matter, which will set out the grounds for the decision in more detail, including the aforementioned assessment of the buyers' suitability.
