The Bundeskartellamt has cleared the creation of a joint venture between four operators affiliated with Protestant parishes in the Ruhr area. The joint venture will be based in Herne, North Rhine-Westphalia, and is to pool the work of the four organisations Innere Mission – Diakonisches Werk Bochum e.V., Evangelischer Kirchenkreis Herne / Castrop-Rauxel KdöR, Diakoniewerk Gelsenkirchen und Wattenscheid e.V. and Evangelische Stiftung Augusta (Bochum). The organisations operate a total of eight hospital sites in Gelsenkirchen, Bochum, Hattingen, Castrop-Rauxel, Herne and Witten. The joint venture will be responsible for more than 2,000 hospital beds, a medical care centre (MVZ) and a number of social welfare institutions.

Andreas Mundt, President of the Bundeskartellamt: “An evaluation of patient flows showed that despite the hospitals’ close proximity to one another and many transport connections, hospital patients in the Ruhr area tend to rarely cross city boundaries. The merger will therefore only create insignificant overlaps.”

The merger parties do not have a dominant position in any of the urban market areas. As the parties’ hospital sites are each located in different cities, the market share increases caused by the merger will be insignificant. In addition, patients have several alternative hospitals in their vicinity to choose from, including Catholic hospitals, Knappschaft Kliniken hospitals and other hospitals of the Ruhr University Bochum.

The merger parties are also active in other areas such as elderly care, services for disabled people and youth services. Here the parties’ activities overlap in particular in Bochum and the surrounding area. However, there are so many alternative providers that these aspects do not raise competition concerns either.

Background information: 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.

The current situation puts considerable economic pressure on almost all hospitals. The German hospital sector is going through a phase of change caused by the impact of the Covid-19 pandemic, cost increases which can only in part be compensated by raising fees and the pressure to consolidate in order to cope with stricter regulatory requirements and with the planned reform of the German hospital sector. In the past year the Bundeskartellamt received 14 notifications of mergers in the hospital sector. Of the overall 382 transactions examined between 2003 and January 2024 only seven were prohibited.