The European Commission approved on Tuesday (3) the acquisition of German retailer Ceconomy, owner of the MediaMarkt and Saturn chains, by China's JD.com. The deal, valued at approximately US$ 2.5 billion, received the last necessary regulatory authorization, but will be subject to competition obligations for ten years. Completion of the purchase still depends on closing procedures.
The decision was made after an investigation into subsidies received by JD.com in China. According to the Commission, preferential financing, tax incentives and grants could provide competitive advantages to the company and Ceconomy in the European market, especially in the areas of logistics, technology and financing capacity.
The regulator identified the risk that these resources would allow the company resulting from the acquisition to offer commercial terms difficult for competitors to match, including the possibility of aggressive pricing.
Approval was granted after the companies undertook commitments aimed at preventing the benefits of the subsidies from being improperly transferred to European operations.
What conditions JD.com will have to meet in Europe
The first commitment establishes that all transactions between JD.com and Ceconomy must take place on market terms, including loans and other intra-group financing. The requirement seeks to prevent the German retailer from receiving financial advantages arising from the identified subsidies.
The second obligation involves JD.com's warehousing and logistics services. The company must make them available to independent retailers under the same conditions offered to Ceconomy, preventing its commercial network from having privileged access to the group's logistics capabilities.
The third commitment applies the same principle to technology services. Third parties must receive terms equivalent to those made available to the acquired company.
The requirements were strengthened during the investigation. After consulting market participants, including competitors of the companies, the Commission identified shortcomings in the initial proposals. JD.com and Ceconomy then revised the financial commitments and improved the conditions set out for third-party access to logistics and technology services.
According to the European body, the final set of measures is sufficient to neutralize the identified competitive distortions. The obligations will be valid for ten years, with oversight by an independent administrator under the supervision of the European Commission.
The decision does not mean that competitors are already using these services, nor does it prove a reduction in prices or other concrete benefits for consumers.
Acquisition awaits closing after final authorization
The review was conducted under the European Union's Foreign Subsidies Regulation, in force since July 2023. The legislation allows investigating possible distortions caused by financial support granted by governments of countries outside the bloc.
Ceconomy confirmed that the decision concludes the regulatory authorization stage of the acquisition. The deal had already received approvals related to foreign investment in Germany, France, Italy, Spain and Austria.
With more than 1,000 stores and approximately 50,000 employees, the German company offers JD.com an established e-commerce and physical retail structure in Europe.
Sandy Xu, CEO of JD.com, said the intention is to support Ceconomy's sustainable growth, strengthen its competitive position in the European market and expand innovation. The goals presented by the executive still depend on implementation of the partnership.
The companies said they expect to complete the transaction in the coming days. Until closing, the deal remains approved by the authorities but not formally completed.
