SEPTEMBER 28, 2005
1. COMPETITION
M&A
 On September 28, 2005, WellPoint, the largest US health insurer, agreed to pay US$6.5bn
to acquire WellChoice, a rival boasting a customer base of about 5m members in the
New York City area. The deal continues a wave of consolidation in the insurance
industry that has lasted since 2003 (FT, September 28, 2005 p. 21)
 The following concentration has been notified to the European Commission:
 Berkshire Hathaway/MEHC (insurance) (OJ C238, September 28, 2005)
 The following concentrations have been cleared by the European Commission:
 N&W/MLGPE/BACPE Fund V (vending machines) (RAPID, September 28,
2005)
 GPC/PAI (consumer packaging) (RAPID, September 28, 2005)
State Aid
 The European Commission has ruled that the implementation criteria for aid measures
granted by the Province of Bolzano in Italy were contrary to EC Treaty State Aid rules
(Article 88(3)). Aid granted under the scheme was therefore misused and must be
recovered. However, new implementing rules have been approved by the Commission,
thus allowing the amended scheme to continue (RAPID, September 28, 2005)
Other
 On September 27, 2005 Silvio Berlusconi, Italy’s Prime Minister, steered clear of exerting
more pressure for the resignation of Antonio Fazio, the Bank of Italy governor whose
defiance has plunged the government into turmoil, telling parliament that he had done
everything in his power to secure Mr Fazio’s removal (FT, September 28, 2005, p. 1)
 Macquarie Bank, the Australia based investment fund manager, is understood to have
retained Greenhill, the investment bank, to advise it on a possible bid for the London
Stock Exchange (FT, September 28, 2005, p. 17)
 New York Mercantile Exchange (Nymex) shareholders are becoming more resolute in
their opposition to the board’s recommended tie-up with General Atlantic, the private
equity group, ahead of Nymex’s shareholder meeting on September 29, 2005 (FT,
September 28, 2005 p. 19)
 David O'Reilly and Fu Chengyu, the heads of the US and Chinese oil companies,
Chevron and CNOOC respectively, have re-established top-level contact after their bitter
takeover battle over Houston-based Unocal (FT, September 28, 2005, p. 19)
 On September 28, 2005, Porsche tried to damp criticism of its decision to invest in rival
German carmaker Volkswagen (VW) claiming its planned 20% stake would produce
“double digit” returns and was not the brainchild of Ferdinand Piech, VW chairman,
who has strong links to Porsche (FT, September 28, 2005, p. 20)
 Gala, the bingo and casino group, is in talks to buy Coral Eurobet, the betting shop chain.
A deal would combine a fast-growing bookmaking operation rivaling William Hill and
Ladbrokes with the UK’s biggest bingo operator in a business worth close to UK£4bn
including debt (FT, September 28, 2005, p. 23)
 Swedish opposition to Old Mutual’s UK£3.3bn bid for Skandia, the Nordic region’s
biggest insurer, grew on September 28, 2005 as another state pension fund Fourth
National Swedish Pension Fund (AP4) announced it would reject the offer (FT,
September 28, 2005 p. 23)
 O2 refused to be drawn on its future as an independent mobile operator on September
28, 2005 as it lifted full-year guidance for its key UK and German businesses. The
company has been the centre of take-over speculation since it was de-merged from the
UK telecommunications business BT in 2001 (FT, September 28, 2005 p. 23)
 Vincent Bollore, chairman of Havas, the French marketing services group, has increased
his stake in Aegis, the UK advertising buyer, from 6% to 8.04%, while maintaining his
position that he is a financial investor (FT, September 28, 2005 p. 23)
 DreamWorks SKG has terminated talks to be acquired by General Electric Co.’s NBC
Universal unit, ending current discussions of a potential US$1bn deal (WSJE September
28, 2005, p. A4)
2. TRADE
 On September 28, 2005 sugar-exporting countries lambasted the EU for offloading nearly
2mtons of sugar on to the world market, saying it would push down prices and
undermine Europe’s credibility in world trade talks (FT, September 28, 2005 p. 6)
 Peter Mandelson (EU Commissioner for Trade) travels to St Lucia on September 28, 2005
to launch the third phase of Economic Partnership Agreement negotiations between the
EU and the Caribbean region, encompassing the continued integration of the Caribbean
regional economy and access to the European goods and services market (RAPID,
September 28, 2005)
3. MEDIA / TELECOMMUNICATIONS
 SanDisk, the maker of flash memory cards most commonly used in digital cameras, has
teamed up with EMI to launch a new music format that could eventually replace CDs
and DVDs. The new ‘gruvi’ music card, is pre-recorded with music and designed to
play on mobile phones and hand-held computers (FT, September 28, 2005 p. 19)
 On September 28, 2005 Google announced that it had expanded its index of the internet
to make it three times larger than that of any other search engine (FT, September 28, 2005,
p. 21)
 On September 28, 2005 Sony dismissed concerns about the future of its next-generation
DVD standard after Intel and Microsoft threw their weight behind a competing format
championed by rival Japanese electronics group Toshiba (FT, September 28, 2005 p. 22)
4. FOOD / CONSUMER POLICY / PHARMACEUTICALS
 On September 28, 2005 the European Commission’s Food and Veterinary Office
published a report regarding its inspection of 6-15 June, 2005 concerning protective
measures against Bovine Spongiform Encephalopathy (BSE) in the United Kingdom
(RAPID, September 28, 2005)
5. ENVIRONMENT
 Stavros Dimas (EU Commissioner for the Environment) will hold talks on tackling
climate change with politicians representing European and national associations of local
and regional authorities at the Committee of the Regions (CoR) on October 6, 2005. This
comes as the European Commission proposes a strategy to curb aircraft emissions by
extending the existing pollution trading scheme to all aircrafts taking off from European
airports (RAPID, September 27, 2005)
 On September 27, 2005 the environmental NGO Greenpeace threw down a gauntlet to
the EU by proposing an EU25 energy scenario which, by the year 2050, would see
nuclear energy abandoned and CO2 emissions drastically reduced (EIS, September 27,
2005)
6. TRANSPORT / ENERGY
No major developments
7. ENLARGEMENT
No major developments
8. OTHER DEVELOPMENTS
 Tony Blair, Britain’s Prime Minister, spelt out plans for a raft of economic and public
service reforms for the UK on September 27, 2005 suggesting strongly that he will stay in
power for several more years to implement them (FT, September 28, 2005, p. 2)
 Gerard Larcher, France’s Employment Minister, said on September 28, 2005 that US and
UK investors were unfairly writing off France as “an Asterix village” for its outspoken
state intervention, even though it was the world’s third-biggest destination for foreign
investment (FT, September 28, 2005, p. 2)
 In a preliminary opinion, an advocate-general at the European Court of Justice backed
Bank of America in its fight with the administrators of Parmalat over which European
jurisdiction should oversee the winding-up of the collapsed Italian dairy group’s Irish
offshoot (FT, September 28, 2005 p. 2)
 German business prospects have brightened unexpectedly despite the global impact of
high oil prices and US hurricanes, while Eurozone lending for house purchases has
become still more buoyant, according to data published on September 28, 2005 by the
Munich-based Ifo institute (FT, September 28, 2005, p. 3)
 In a memo released on September 27, 2005, the European Commission announced that,
under a drive for better regulation, the Commission has screened 183 proposals for
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pending EU laws and decided to scrap more than a third (68), including the notorious
‘Directive for Sunlight’ (RAPID, September 27, 2005)
In response to the catastrophic floods that hit Romania during the summer 2005 the
European Investment Bank (EIB) is considering to put in place in close co-ordination
with the Romanian Administration an emergency program for Euro600m. The EIB has
also provided Euro250m for the construction of 36 km motorway connecting Maribor
and the Hungarian border (RAPID, September 27, 2005)
One of the main messages of Eurochambres, the Association of European Chambers of
Commerce and Industry, at its annual congress (September 29 - 30, 2005), will be that
Europe needs to invest in its educational systems to improve attitudes towards
entrepreneurship (EIS, September 27, 2005)
On September 28, 2005 the European Parliament is due adopt a compromise law aimed
at boosting corporate auditing standards in the wake of recent financial and accounting
scandals (EIS, September 27, 2005)
The European Parliament has voted to reject the draft Framework Decision on data
retention from the EU Council of Ministers. The non-binding opinion passed on
September 27, 2005 which has no legal effect, left the door slightly ajar for the European
Commission’s draft Directive proposed on September 21, 2005 (EIS, September 27, 2005)
A two-day major seminar on the new round of Territorial Cooperation Programs under
Objective 3 of the Structural Funds is being held on September 28-29, 2005 in Brussels
(RAPID, September 28, 2005)
The European Commission, on behalf of the EU, which is a member of the North-west
Atlantic Fisheries Organization (NAFO), has welcomed the outcome of the
organization’s annual meeting held in Tallin, Estonia. The contracting parties confirmed
the continued implementation of the 2003 Greenland halibut recovery plan which will
see a reduction of the total allowable catch (TAC) from 19,000 tons in 2005 to 18,500 tons
in 2006 (RAPID, September 28, 2005)
List of abbreviations
AE:
DG COMP:
DG INFOSOC:
EIS:
EV:
FT:
OJ:
RAPID:
WSJE:
Agence Europe
The web-site of the Directorate-General for Competition
The web-site of the Directorate-General for Information Society and Media
Europe Information Service (formerly European Report)
European Voice
Financial Times
Official Journal
Rapid – The Press and Communication Service of the European Commission
Wall Street Journal Europe
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