BELGIUM: EC signals acceptance of Fiat-IBM tie-up

The European Commission has signalled that it is prepared to accept the creation of joint venture companies involving auto-makers and computer suppliers as way of handling IT within the automobile sector, by approving a deal between IBM Italia and Fiat. The two companies will set up a joint venture involving Business Solutions, Fiat's holding company for IT. Although the merged unit will be large, the Commission concluded that there was sufficient competition within the Italian IT sector for the deal to be approved. More importantly, it also said that competition problems were not an issue, because this type of joint venture replaces captive outsourcing within Fiat, which can still hire other computing management suppliers.

bcusack July 4, 2001

The
European Commission has signalled that it is prepared to accept the creation of
joint venture companies involving auto-makers and computer suppliers as way of
handling IT within the automobile sector, by approving a deal between IBM Italia
and Fiat. The two companies will set up a joint venture involving Business Solutions,
Fiat’s holding company for IT. Although the merged unit will be large, the Commission
concluded that there was sufficient competition within the Italian IT sector for
the deal to be approved. More importantly, it also said that competition problems
were not an issue, because this type of joint venture replaces captive outsourcing
within Fiat, which can still hire other computing management suppliers.