Antitrust Law Daily Wrap Up, ACQUISITIONS & MERGERS NEWS: EC clears Alcoa acquisition of titanium producer RTI, (Jun 11, 2015)

By Edward L. Puzzo, J.D.

The European Commission has approved the acquisition of RTI International Metals by Alcoa, the Commission announced today. Both are American companies producing or purchasing titanium. RTI produces titanium mill and melted products, and extruded and machined components, mainly for the aerospace industry. Alcoa purchases such titanium products as inputs for its casting and forging activities. The Commission's investigation found that the transaction would raise no competition concerns, because the merged entity will continue to face sufficiently strong competition after the merger. Customers of titanium products would continue to have other sources of supply, many of which are protected by long term agreements. The Parties also do not represent a significant sales outlet for other producers of titanium products (case number M.7593).

Cocoa. Separately, the Commission approved the acquisition of the cocoa business of ADM of the United States by Olam of Singapore. Olam is a global commodity merchant and processing company specialized in cocoa, coffee, nuts, rice, and cotton. ADM's cocoa business trades cocoa beans and produces cocoa semi-finished products. The companies' activities overlap in the markets for the procurement and supply of cocoa beans, and the supply of cocoa liquor, butter, and powder. The Commission concluded that the proposed acquisition would raise no competition concerns, given the companies' moderate combined market positions and the presence of a number of strong players supplying beans and cocoa products in the European Economic Area (EEA) (case number M.7510). In related news, the Commission is currently also assessing the proposed acquisition of ADM's industrial chocolate business by Cargill (case number M.7408).

Flooring. Finally, the Commission has approved the proposed acquisition of International Flooring Systems of Luxembourg by Mohawk Industries of the United States. Mohawk is a global supplier of a broad range of flooring products, wood-based panels and insulation materials. International Flooring Systems supplies vinyl and laminate flooring products as well as wood-based panels. The companies' activities overlap within the EEA in the supply of wood-based panels, including medium density fiberboards (MDF), the supply of vinyl and laminate flooring products as well as the licensing of locking technologies for flooring products. The Commission investigated the markets for MDF, and particularly the supply of small-sized MDF in the Benelux countries, and found that a sufficient number of credible alternative suppliers will remain available after the transaction. Mohawk submitted commitments related to the potential impact of the transaction on MDF in the Benelux countries, but the Commission found that they were not necessary since no specific competition concerns arise with respect to the supply of MDF in the Benelux countries. With respect to flooring products the Commission similarly concluded that there are a sufficient number of suitable alternative suppliers on the market. In addition to this, the Commission also found that the transaction would not significantly change the current market structure or competitive conditions regarding the licensing of locking technologies. The Commission therefore concluded that the transaction would raise no competition concerns (case number M.7529).

Companies: Alcoa; RTI International Metals; ADM; Olam; Cargill; International Flooring Systems; Mohawk Industries.

News: AcquisitionsMergers Antitrust