The Bundeskartellamt has swiftly cleared the planned acquisition of Klinikum Burgenlandkreis GmbH, based in Naumburg/Saale, by the private clinic operator SRH Kliniken GmbH, headquartered in Heidelberg, in the first phase of merger control.

Andreas Mundt, President of the Bundeskartellamt: “Competition between suppliers fulfils an important function also in the health sector. When exercising merger control, we assess whether patients will have sufficient local alternatives to choose from even after the merger of two hospitals. Competition between hospitals means that hospitals have to attract patients, which gives them an incentive to invest in quality and innovation. In this way, the quality of treatment is ensured for the benefit of the patients. Protecting competition thus helps to achieve the health policy objectives in the hospital sector.”

Klinikum Burgenlandkreis operates two general hospitals in Naumburg/Saale and in Zeitz with a total of approximately 750 beds, and medical care centres with surgeries at seven locations. Since September 2019, the company has been under debtor-in-possession management within the framework of insolvency proceedings. SRH Kliniken operates the Gera-based clinic SRH Wald-Klinikum Gera with a total of approximately 1,000 beds and a medical care centre. The SRH group is a large operator of private hospitals in Germany managing ten acute-care hospitals, six rehabilitation clinics and numerous medical care centres in the federal states Baden Württemberg, Thuringia and Saxony-Anhalt.

The merger will affect the regions Naumburg, Weißenfels/Zeitz and Gera. In the regions Naumburg and Weißenfels/Zeitz, Klinikum Burgenlandkreis clearly holds a leading position with large market shares, giving it a strong lead over the other hospital operators. In the Gera region, however, the leading position is clearly held by SRH Klinikum. It was nevertheless possible to clear the proposed merger since other important competitors, such as Universitätsklinikum Jena or Asklepios Klinik Weißenfels, will be available in the regions in question also after the merger. The parties to the merger are only secondary competitors to each other.

Background - Merger control in the hospital sector:
Irrespective of their operators, hospitals are independently active as entrepreneurs and compete with one another. Due to strict legal provisions there is almost no price competition in this sector. It is therefore the main objective of merger control to maintain competition in the quality of healthcare for patients. It is crucial to ensure that patients have sufficient local options to choose from.

In spite of the growing concentration in the hospital sector, only very few mergers had to be prohibited by the Bundeskartellamt in recent years. Of the 314 transactions reviewed in total between 2003 and the end of 2019 only seven were prohibited. Two cases were withdrawn during the second phase review after the authority had expressed its concerns. In many cases, the Bundeskartellamt carried out an informal pre-assessment before the mergers were formally notified. Since 2011, there have been eight cases in which the intended merger was not notified after the authority had expressed its preliminary competition law concerns.