EU clears acquisition of Columbian Chemicals by Birla Group

The European Commission has cleared under the EU Merger Regulation the proposed acquisition of US-based Columbian Chemicals by Indigold Carbon, which is controlled by the Indian Aditya Birla Group, both worldwide producers of carbon black. The acquis

The European Commission has cleared under the EU Merger Regulation the proposed acquisition of US-based Columbian Chemicals by Indigold Carbon, which is controlled by the Indian Aditya Birla Group, both worldwide producers of carbon black. The acquisition, which would bring together two of the four largest worldwide producers of carbon black, was notified to the European Commission for clearance on 5 May this year because the companies do significant business in Europe.

Carbon black is a chemical product used mostly in the production of tyres but also in printing inks and plastics. The Commission has concluded that although the merger would create one of the three largest companies in the sector, European customers would continue to enjoy healthy competition.

The Commission examined the impact in the European Economic Area and concluded that European customers would still be able to source carbon black from different suppliers across the EEA and beyond. In particular, continued competition would remain from different producers located within the EEA and also from direct imports from Russian and Ukrainian manufacturers.

The current tight supply of carbon black within Europe is attributable to the recession and the consequent reduction in production capacity. The Commission found that this potential merger had no significant impact on production levels that were rather cyclical in nature and that production capacity is likely to respond to the recovery of demand. The Commission therefore concluded that the transaction would not significantly impede effective competition in the EEA or any substantial part of it.