Thales Extends Gemalto Acquisition Deadline Amid Antitrust Investigation

“Essentially, according to the new arrangement, the acceptance period will close two weeks after the deal attains all necessary regulatory approvals, and no later than March 31st, 2019.”

Thales has dramatically extended the deadline for its acquisition offer for Gemalto.

The move comes soon after the European Commission’s announcement last month that it would open an in-depth investigation into the proposed acquisition over antitrust concerns, as both companies are major providers of hardware security modules for the European market and beyond. Whereas previously the acceptance period for Thales’ offer had been extended to August 15th, the companies have now pushed that back via an exemption granted by the Dutch financial market authority. Essentially, according to the new arrangement, the acceptance period will close two weeks after the deal attains all necessary regulatory approvals, and no later than March 31st, 2019.

In a statement announcing the extension, Thales and Gemalto noted that the proposed acquisition requires approval from antitrust regulators in Australia, China, the European Union, Israel, Mexico, New Zealand, Russia, South Africa, Turkey, and the US, where it also needs Committee on Foreign Investment in the United States approvals; as well as foreign investment clearances from authorities in Australia, Canada, and Russia. “At this point, Thales and Gemalto have obtained 3 of these 14 authorisations: anti-trust clearances in China and Israel, and clearance relating to foreign investments in Australia,” the statement said.

The companies added that they expect to obtain all outstanding clearances before the end of the year.

Regulatory approval – or rather the lack thereof – proved to be the key issue behind the recent collapse of Qualcomm’s effort to acquire NXP Semiconductors. In that case, however, the refusal of Chinese authorities to approve the deal was seen by many analysts as part of a larger trade conflict with the United States; whereas the European Commission’s investigation of the Thales-Gemalto deal appears to be be more straightforwardly concerned with preventing monopolization in the tech security market.

Sources: Thales, European Commission, Reuters