IAI, Elbit Systems team on unmanned vehicle
Antitrust Authority director general Ronit Kan: The joint venture won’t harm competition.
Hadas Magen 28 Mar 07 16:00
Antitrust Authority director general Ronit Kan has exempted Israel Aerospace Industries Ltd. (IAI) and Elbit Systems Ltd. (Nasdaq: ESLT; TASE: ESLT) from restrictive trade practices, allowing them to jointly develop, manufacture and market an unmanned vehicle for military use. Kan said that she was persuaded that the main aspects of the joint venture would not limit or prevent competition.
The two companies will develop unmanned vehicles for a Ministry of Defense request for border and road security missions. The companies agreed that they would set up a joint venture via a company owned in equal shares for this purpose.
Kan said that the joint venture was a horizontal collaboration between competitors in a new sector. She said that the development stage required heavy financial and human resource investment, which necessitated cooperation.
The exemption is conditional. Kan insists that all activity related to the joint venture will be carried out solely via the joint company, and that this company will not conduct any other activity, except with prior approval.
She also demands that IAI and Elbit Systems may not share information relating to the costs, sales, profits, or pricing of the joint venture, except what is necessary for promoting its predefined activity. The parties may not share information unrelated to the joint venture’s direct field of activity.
Published by Globes [online], Israel business news - www.globes.co.il - on March 28, 2007
