Magazine Luiza acquisiton approved by CADE with restrictions

Magazine Luiza acquisition of FS Vasconcelos e Cia Ltda ("Lojas Maia") was approved by CADE with restrictions referring to the non-competition clause in the geographic dimension.

Magazine Luiza is one of the major retail and durable goods chain of stores in Brazil. It has 459 stores in seven states and also acts on e-commerce delivering products to the whole country. Lojas Maia has 133 stores in nine states.

The Secretariat of Economic Monitoring (SEAE) had released and opinion suggesting the approval of the transaction with restrictions on the non-competition clause to adequate it on the geographic feature, restricting the clause to some municipalities.

The Reporting Counselor voted on the same line as SEAE suggested to approve the operation with restrictions of the non-competition geographic clause to have municipal dimension and its validity only in cities in the states of Alagoas, Bahia, Ceara, Maranhão, Paraiba, Pernambuco, Piauí, Sergipe and Rio Grande do Norte.

All the other counselors agreed with the Reporting Counselor.


CADE may appoint an intervenor at Saint Gobain plant

In July 2008 CADE rejected the acquisition by Owens Corning of Compagnie de Saint Gobain's fiberglass division in Brazil. The acquisition was part of a multinational deal, and marked one of the few opportunities in which CADE has blocked a transaction completely. At the time, the Brazilian competition agency provided Owens Corning with a deadline until February 1st 2011 to either divest a Saint Gobain's plant in State of São Paulo or submit a strategic plan for the sale to be completed (as the use of an independent investor to intermediate the divestiture).

According to a statement by CADE's President Fernando Furlan earlier this week, the deadline expired without any alternative solution being suggested by Owens Corning, which could cause CADE to begin an intervention at the former Saint Gobain's plant until the manufacturing unit is sold to an independent third-party. This would be the first time in CADE's history that it would make use of the powers granted by article 63 of the local antitrust law ("the execution of CADE's decisions shall be carried out by all means, including by way of intervention in the company, if necessary").


Health Care Insurance Acquisiton Approved by CADE.

CADE has approved the acquisition of health care insurance companies "Planos de Saúde Integrais S.A.", "Assistência Médica São Paulo S.A." and "Orion Participação e Administração S.A." by Amil Assistência Médica Internacional Ltda last Wednesday - February 9th, 2011. The Counselors decided to follow the guidance of the National Health Insurance Agency ("ANS") over the territorial concept advocated by the Secretary of Economic Monitoring ("SEAE") in the analysis of the relevant market in the sectors of health care services providence and health insurance sales. The Counselors approved the transaction with a restriction of the non-competition clause for the next five years in markets operated by "Assistência Médica São Paulo S.A." and "Planos de Saúde Integrais".