PARIS — The European Commission announced Friday (June 27) it has authorized, under the EU merger regulation, the proposed joint venture between STMicroelectronics NV and NXP BV.
Following a market investigation, the Commission concluded that the transaction would not "significantly impede effective competition" in the European Economic Area or any substantial part of it.
The investigation indeed revealed that the creation of the joint venture would "not give rise to any competition concerns in the market for wireless handset semiconductors as the new entity would face several competitors, and customers would continue to have access to a sufficient number of alternative suppliers," the Commission stated.
The Commission said it has also considered the fact that the STM and NXP businesses to be conferred to the joint venture are to a large extent complementary.
Last week, ST and NXP announced that their joint venture would be called ST-NXP Wireless and led by Alain Dutheil as CEO.
ST-NXP Wireless is created from the mobile and wireless businesses of ST and NXP, which together generated $3 billion in revenue in 2007. The newly-formed company, 80 percent owned by ST and 20 percent owned by NXP, aims to start operations working on 2G, 2.5G, 3G, multimedia, connectivity and all future wireless technologies, in the third quarter of 2008.
