Brussels, 30 November 2010
Mergers: Commission approves the extension of the activities of ASK, an existing joint-venture between Ashland and Süd-Chemie
The European Commission has cleared under the EU Merger Regulation the proposed transfer to Ashland-Südchemie Kernfest GmbH ("ASK") of most of the foundry consumable activities of its parent companies, Süd-Chemie AG ("Süd-Chemie") and Ashland Inc. ("Ashland"). After examining the operation carefully, the Commission concluded that the transaction would not significantly impede effective competition in the EEA or any substantial part of it and has therefore approved the concentration.
Süd-Chemie is a German company active in speciality chemical products. Ashland is a US manufacturer of chemical specialty and performance products as well as a distributor of chemicals and plastics. ASK is an existing joint venture between the two that manufactures and supplies chemical products for the foundry industry. Under the notified deal, Ashland and Süd-Chemie are further contributing to ASK all their remaining foundry consumable activities, except Süd-Chemie's foundry bentonite business, which will be retained by Süd-Chemie. Foundry consumables are used in the casting process – the production of shaped articles by pouring molten metal into moulds.
The Commission’s examination of the deal showed that Ashland and Süd-Chemie’s foundry consumable activities are for a large part complementary. Horizontal overlaps between ASK and its parents are relatively limited, with a few exceptions notably in resin binders and zirconia foam filters. Regarding resin binders (products used to bind, form and compress sand to form moulds and cores for the casting of metal parts), ASK was not actively competing with its parent company Ashland prior to the concentration. Moreover, alternative sources of supply exist from other large European players. Concerning zirconia foam filters (a special type of foundry filter use to remove non-metallic impurities from the molten metal and to control the flow of the metal as it fills the mould), ASK will continue to face competitors with significant market shares. In addition, pre-merger, ASK and Ashland were merely distributing Süd-Chemie's zirconia foam filters and therefore were not to be considered as independent alternative sources of supply.
The Commission also studied ASK's enlarged product range and concluded that there would be no risk of any of the markets concerned being closed off, as there are alternative and competing sources of supply.
The transaction was notified to the Commission on 22 October 2010. More information on the case will be available at: