SSDIY Samsung SDI Company Ltd (PK)

   By Cristina Roca 
 

European Union antitrust authorities said Monday that they have opened an investigation into Hungary's plans to grant 108 million euros ($119.2 million) of public funds to Samsung SDI Co. Ltd. (006400.SE) for the expansion of its battery-cell plant in God, Hungary.

The European Commission said it has doubts whether Hungary's plan to support Samsung SDI's investment is in line with EU rules on regional state aid, which aims to foster growth in disadvantaged regions in Europe.

"The Commission will carefully investigate whether Hungary's planned support is really necessary for Samsung SDI to invest in God, is kept to the minimum necessary and does not distort competition or harm cohesion in the EU," said EU antitrust chief Margrethe Vestager.

Samsung SDI is investing around EUR1.2 billion in the expansion of its plant. Investments by large companies in existing production facilities generally aren't eligible for regional investment aid, the European Commission said.

The EU's watchdog will examine whether Samsung SDI's investment in the region would have taken place even without the public funds, and said it has doubts about the aid support's "contribution to regional development and its appropriateness and proportionality."

Write to Cristina Roca at cristina.roca@dowjones.com; @_cristinaroca

(END) Dow Jones Newswires

October 14, 2019 06:14 ET (10:14 GMT)

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