Aug 12 2006
The European Commission has today cleared the way for INEOS to acquire BP's Ethylene Oxide/Ethylene Glycol business in Dormagen, Germany. Following an in-depth investigation the Commission has concluded that the proposed acquisition would not significantly impede competition in the European Economic Area (EEA) or a substantial part of it.
The decision was welcomed by INEOS. "We are pleased that the Commission has reached this conclusion," commented Hans Casier CEO INEOS Oxide. "We have always maintained that although INEOS would have a high market share, competition would not be significantly impeded as a result of the acquisition of the business. A view that has been confirmed by the announcement made today."
"The addition of the Ethylene Oxide business at Dormagen will help INEOS Oxide to continue to meet the needs of its customers. Our focus now is on a successful acquisition of the business and seamless transition into the INEOS Group of companies," he added.
In its statement the Commission commented that the combined entity would have high market shares in the merchant market for ethylene oxide. However, the investigation revealed that competitors would have the ability and the incentive to react to potential price increases by INEOS. In addition, substantial new capacity for ethylene glycols is being commissioned in the Middle and Far East, producing ethylene glycols at substantially lower costs than in Europe. As a result, imports of ethylene glycols into the EEA market will increase. Given the number of market players and their ability to divert part of their ethylene glycols production into the ethylene oxide merchant market, the Commission concluded that there would be sufficient alternative suppliers.