Nestlé SA has informed the Commission of the latest developments in its discussions with the Castel group on the purchase by Castel of a number of springs which Nestlé undertook to sell when it purchased Perrier. On 25 February 1992 Nestlé notified the Commission that it was making a takeover bid for the shares of Source Perrier SA. Initial examination showed that a merged Nestlé/Perrier group would hold a strong position on a highly concentrated market, and the Commission decided to initiate full inquiry proceedings. On 22 July, following commitments entered into by Nestlé, the Commission authorized the transaction subject to certain conditions. These were designed to facilitate the entry to the French bottled water market of a viable competitor with sufficient resources to be able to compete effectively (see IP(92)617). To satisfy the conditions attached to the Commission decision Nestlé undertook to sell a number of mineral water brands, together with a substantial capacity of water for bottling. It was agreed that the Commission would approve the transaction provided it was satisfied that the buyer had sufficient financial resources and expertise to develop as a credible competitor on the bottled water market. Nestlé has asked the Commission to approve the Castel group as buyer; Castel is already active on the drinks market. Castel states that it would be interested in acquiring the four major sources which Nestlé had undertaken to sell, namely Vichy, Thonon, Saint-Yorre and Pierval, and a number of smaller sources. Nestlé thus proposes to meet the main conditions attached to the decision of 22 July, and the Commission takes the view that Castel's offer represents a decisive step towards compliance with all the conditions laid down. The Commission will accordingly be closing the case once the obstacles to the actual transfer of these springs have been lifted: in particular, the French Government must first transfer the right to exploit the Vichy spring to Castel, and the municipal authorities of Thonon les Bains must transfer the right to exploit the Thonon spring. * * *
