The European Commission has approved Baker Hughes’ acquisition of Chart Industries, but only after the energy technology giants agreed to sweeping commitments aimed at protecting competition in the global LNG equipment market.
The Commission’s approval under the EU Merger Regulation is conditional on Baker Hughes and Chart fully implementing the remedies they offered, including the sale of key Chart businesses and guarantees that their equipment will remain compatible with rival suppliers’ technologies.
Baker Hughes, a US-based global energy technology company, provides products and services primarily for the oil and gas sector. Chart Industries designs and manufactures industrial process equipment used across the energy and gas industries.
The deal would combine two major players in the supply of liquefied natural gas (LNG) liquefaction equipment — technology used to cool natural gas to extremely low temperatures so it can be converted into LNG and transported over long distances. Together, the companies would control a broad portfolio of equipment and technologies needed to develop and operate LNG liquefaction facilities.
The Commission’s investigation found that the transaction, as originally proposed, could weaken competition in global LNG liquefaction equipment markets, affecting both European competitors and customers.
Officials raised particular concerns over Baker Hughes’ strong position in LNG compressor trains — a critical component of LNG facilities. The Commission said Baker Hughes could potentially use that market strength to give Chart’s LNG business an unfair advantage over rivals.
According to the Commission, possible risks included limiting access to Baker Hughes’ compressor technology for customers that did not also buy Chart products, reducing compatibility between Baker Hughes and Chart equipment and third-party systems, or using sensitive commercial information from projects involving competing LNG technology providers to strengthen Chart’s position.
The Commission concluded that combining these technologies under one company could harm competition, potentially leading to higher prices and reduced innovation.
To resolve the concerns, Baker Hughes and Chart committed to divest Chart’s proprietary process technology, known as IPSMR, along with its small-scale process technology business, to a third-party buyer approved by the Commission.
They also agreed to maintain interoperability between their equipment and LNG systems supplied by competitors.
The commitments will remain in place for 10 years and are designed to prevent Baker Hughes from having both the ability and incentive to favour Chart’s LNG operations.
The Commission said the revised transaction no longer raised competition concerns and approved the deal subject to strict compliance with the commitments. An independent trustee will oversee implementation under Commission supervision.
