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EC investigates Austrian merger

Stuart Collins

December 21, 2006 Reprints

European Union P/C Legislation & Regulation P/C Insurers More + Less -

BRUSSELSThe European Commission is to investigate the sale of an Austrian bank to one of the country's insurers.

In a statement the EC said that it has launched a formal investigation under "state aid rules" into the sale of Bank Burgenland to Grazer Wechselseitige Versicherung A.G. in Austria.

Land Burgenland decided to sell the bank in March 2006 to the insurance company for €100.3 million ($132.14 million), although the tender procedure had also produced an offer of €155 million ($204.65 million) by an Ukrainian/Austrian Consortium.

Through its investigation, the EC will consider whether the tender was conducted in a discriminatory manner and if the sale involved state aid.

EU Competition Commissioner Neelie Kroes said: "The Commission must check whether Land Burgenland had objective, transparent and non-discriminatory reasons to favor the offer of Grazer Wechselseitige Versicherung AG. Otherwise, the sale might involve state aid that may be illegal under EU rules."

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EC investigates Austrian merger

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