Antitrust Law Daily Wrap Up, ANTITRUST NEWS: EC investigating Huntsman’s acquisition of the titanium dioxide assets of Rockwood, (Mar 6, 2014)
Organizations Mentioned:Huntsman Corp. | Rockwood Holdings, Inc.
By Linda O’Brien, J.D., LL.M.
The European Commission (EC) has opened an in-depth investigation into the proposed acquisition by Huntsman Corporation of a number of equity interests held by Rockwood Holdings, Inc. Both companies are based in the United States.
The EC announced yesterday that it has concerns that the transaction might reduce competition in the market for sulphate-based titanium dioxide in Europe. Titanium dioxide is a chemical used for whitening dishes, paper, bathtubs, clothing, toothpaste, cream, cookies, PVC window frames, etc. It also adds opacity, contributing to brightness and color. The EC has until July 22, 2014, to determine whether its initial concerns are confirmed or not.
Huntsman produces a wide range of specialty and intermediate chemicals worldwide. Rockwood is also active worldwide in the chemicals sector. The businesses of Rockwood that Huntsman plans to acquire are the production of titanium dioxide and functional additives (operating under the name “Sachtleben”); businesses in color pigments, timber treatments, wood protection chemicals, water treatment chemicals; and a specialist provider of rubber automotive spare parts (operating under the name “Gomet”).
The EC’s preliminary investigation revealed that the proposed transaction would raise competition concerns in this market, and more particularly in applications using sulphate-based titanium dioxide where Huntsman and Sachtleben are the two leading suppliers worldwide and compete closely.
The EC has concerns that the remaining competitors may not be able to exert sufficiently strong competitive constraint on the merged entity in specialty markets using sulphate-based titanium dioxide (namely printing inks, cosmetics, pharmaceuticals, food, fibers). The removal of the competitive constraint that Huntsman and Sachtleben currently exert on each other may therefore lead to less choice for customers and potentially to higher prices for the products involved.
Companies: Huntsman Corp.; Rockwood Holdings, Inc.
News: Antitrust