• Complementary businesses and limited overlaps point to few competition concerns
• Combined market positions and geopolitical factors could result in a ‘normal procedure’ review
• Anti-dumping probe and Unreliable Entity List designations unlikely to materially affect SAMR assessment

Teledyne Technologies’ proposed acquisition of Varex Imaging is unlikely to raise significant competition concerns in China given limited business overlaps, according to competition lawyers contacted by this news service.

However, potential concerns relating to supply security cannot be entirely dismissed in light to the acquirer’s links to China’s Unreliable Entity List (UEL), they said.

Announced on 10 August, the proposed USD 1.1bn combination is subject to clearance or approval under certain antitrust regimes, including China, according to a Varex SEC filing dated 9 September 2026.

Lawyers said the transaction appears largely complementary with limited overlap in the X-ray detector segment and is therefore unlikely to give rise to material competition concerns.

As Teledyne executive chairman Robert Mehrabian stated in the deal announcement, “while Teledyne and Varex serve similar customers with related technologies, our products are uniquely complementary with minimal overlap”.

According to Mehrabian, Teledyne manufactures X-ray detectors but does not offer X-ray tubes, high-end detectors suited for high-radiation environments, or advanced photon counting detectors for healthcare and industrial inspection, all of which are produced by Varex.

Through the acquisition, Teledyne would fully complete its product line layout and become the only independent supplier capable of providing CT tubes, detectors, and radiotherapy magnetrons, with coverage across key imaging components used in digital radiography (DR), computed tomography (CT), photon-counting CT, and radiotherapy systems.

Normal case likely

The transaction could nevertheless be handled under the State Administration for Market Regulation’s (SAMR) ‘normal procedure’, the lawyers said. The parties’ market shares appear sufficient to exceed SAMR’s 15% benchmark typically used for identifying ‘simple cases’ in horizontal mergers and may approach the 25% threshold often considered in vertical or conglomerate deals. In addition, the geopolitical sensitivities surrounding the deal parties may encourage a more detailed review.

Varex is the world’s largest manufacturer of X-ray tubes, with a market share exceeding 22%, according to a 2025 report by research firm QYResearch. The report identified Varex Imaging, Canon Electron Tubes & Devices and IAE as the leading suppliers, with the three companies together accounting for approximately 37% of the global market, according to the report.

Teledyne is also a leading player in several imaging-related markets. Its subsidiary Teledyne FLIR accounted for approximately 18.2% of global revenue in handheld thermal imaging cameras in 2025, while holding around 20% of the marine thermal imaging camera market and an estimated 19.8% share of the marine vision inline camera inspection segment, according to research reports by QYResearch and Global Market Insights.

Upon completion of the acquisition, Teledyne is expected to rank first globally in CT tubes, with an estimated market share of 24%–35%, flat panel detectors, with a share of approximately 15%–18%, and radiotherapy magnetrons, where it would hold an estimated 90%, according to a domestic media report.

While the complementary nature of the transaction suggests it is unlikely to materially increase concentration level across the markets, concerns may still arise among downstream Chinese customers. High barriers to entry, significant switching costs and the reduction in the number of major suppliers available to Chinese high-end imaging equipment producers could all attract scrutiny, according to the report.

Geopolitical impact limited

The transaction presents an unusual set of circumstances, as the target is involved in an ongoing anti-dumping investigation in China while the acquirer has two subsidiaries included on the country’s UEL.

China’s Ministry of Commerce (MOFCOM) initiated an anti-dumping investigation involving Varex on 4 April 2025 and subsequently extended the investigation through 3 October 2026. Under the relevant rules, the investigation is expected to conclude shortly and cannot be extended further.

Two competition lawyers told this news service that the anti-dumping investigation is unlikely to affect SAMR’s merger review.

Anti-dumping investigations focus on whether imported products are being sold at unfairly low prices that may harm domestic industries, whereas merger reviews typically assess whether a transaction could reduce competition and lead to higher prices or other adverse effects, said one lawyer, noting that the concerns underpinning an anti-dumping investigation are therefore fundamentally different from those considered in merger control reviews.

Teledyne’s two subsidiaries Teledyne Brown Engineering and Teledyne FLIR were added to the China’s UEL on 4 March 2025 and 9 October 2025, respectively.

The same lawyer said the UEL designation also appears unlikely to materially influence SAMR’s assessment. The purpose of the UEL regime is to restrict or prohibit Chinese companies from conducting business with listed entities, whereas merger reviews generally examine whether a transaction could undermine supply security or market competition. The objectives of the two regimes are not aligned, according to the lawyer.

In practice, SAMR routinely seeks comments from relevant third parties including government agencies such as MOFCOM, during its merger review. Whether MOFCOM may raise concerns stemming from the deal parties’ involvement in the anti-dumping investigation or UEL framework remains uncertain, the lawyer said, adding that these factors could nevertheless introduce additional complexity into SAMR’s review.

Teledyne and Varex did not respond to requests for comment.