European Commission to investigate Dow, DuPont merger
The Commission will probe whether or not the merger will impact prices, competition.
August 15, 2016 by Canadian Plastics
The European Commission (EC) has launched an in-depth investigation to review whether the proposed merger of chemical giants DuPont Co. and the Dow Chemical Co. satisfies the EU Merger Regulation.
The EC will probe whether or not deal reduces competition in the petrochemical production industry, as well as in crop protection and seed development.
“We need to make sure that the proposed merger does not lead to higher prices or less innovation for these products,” European Commissioner Margrethe Vestager said in a statement.
First announced in 2015, the proposed merger between US-based companies Dow and DuPont would see the mega-company split into three separate publicly traded companies. One company will focus on agriculture, one on material science, and one will make and sell specialty products. The two sides have been eliminating staff and closing facilities as they get ready to combine. DuPont is laying off about 10 per cent of its staff worldwide, and Dow said it will cut 2,500 jobs. The two companies say the merger will reduce their annual spending by US$3 billion.
The EC has 90 working days, until 20 December, to make a decision.