---------------------- multipart/alternative attachment Watchdog quashes piano buyout The Fair Trade Commission stopped a major domestic piano maker from buying out its rival yesterday. Samick Musical Instrument Co., a domestic piano manufacturing company, has been in the process of taking over its rival and market leader, Young Chang Piano Co., for the past six months. It was told to sell off the 48.6 percent share it bought from Young Chang within a year. The watchdog said if Samick takes over Young Chang, competition would disappear, and the market would be monopolized. The commission said that if Samick, which has 33 percent of the domestic market, takes over Young Chang, which has a 59 percent market share, its share would be 92 percent. The high percentage would eventually hurt consumers with high prices, said an official from the commission. Young Chang could survive without Samick, since its high potential market value could attract many other domestic companies, he added. Samick, however, plans to file a suit against the commission and take other legal measures regarding the decision. The company views the commission's order as typical bureaucratic red tape, which ignores the commercial reality of the domestic piano industry. Taking over companies on the verge of bankruptcy is a way to restructure industries, but the watchdog made an unreasonable decision based purely on market share figures, said an industry source. Kim Jong-seop, president of Samick, said that the commission did not seem to know the reality of current domestic business conditions. "If another company takes over Young Chang, the possible growth would not be as dramatic," he said. A legal expert said that the domestic piano market is fully open and sales are decreasing, making it impossible for prices to go up. "The Fair Trade Commission seems to have overly exaggerated the negative effect of monopolies and oligopolies." The idea of an acquisition was actually suggested by Young Chang in March. Young Chang graduated from a debt workout program in June 2002, but its debt increased by 600 percent last year because it claims it had to make excessive retirement payments while cutting its workforce. It has run in the red for three years. When its workers went on strike, management decided to sell the company, and notified three domestic companies, including Samick, of its intention. Currently, domestic piano makers are going through a deep slump. Young Chang's sales for the first half are only 60 percent of its sales a year ago. People are selling their pianos rather than buying new ones. Used pianos take up around 70 percent of the domestic piano market currently, worsening the condition for piano makers. The commission's decision has discouraged the domestic piano industry, which is already in difficulty, said an official of the industry. http://tinyurl.com/4usk2 ---------------------- multipart/alternative attachment A non-text attachment was scrubbed... Name: not available Type: text/enriched Size: 3344 bytes Desc: not available Url : https://www.moypiano.com/ptg/pianotech.php/attachments/e9/cd/0d/8a/attachment.bin ---------------------- multipart/alternative attachment--
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