The proposed merger between diversified chemicals company Dow and science company DuPont will proceed as planned after the ACCC announced that it will not stand in the way of the transaction.
The ACCC had been investigating the effect the global merger would have on the Australian market, citing ‘competition concerns’ as a potential stumbling block.
“The ACCC previously had concerns the proposed merger may substantially lessen competition in the supply of certain insecticides and materials science products and reduce competitive tension in research and development of new crop protection products,” ACCC Commissioner Mick Keogh said.
“The ACCC considers that these competition concerns will be addressed by the global divestments and, subject to those occurring, will not oppose the merger in Australia.”
The proposed merger, subject to divestiture of major parts of DuPont’s global pesticide business and global research and development organizsation, had been cleared by the European Commission on 27 March 2017. Separately Dow will also divest its acid co-polymers and ionomers business.
Mr Keogh noted that the ACCC had worked closely with the European Commission, the US Department of Justice, the Canadian Competition Bureau and the New Zealand Commerce Commission in assessing this merger.
“As the remedies provided to other regulators have resolved competition concerns in Australia, the ACCC has taken a pragmatic approach and not sought standalone remedies in Australia,” he concluded.