Brussels, 02/12/2015 (Agence Europe) - On Wednesday 2 December, the European Commission gave its conditional authorisation to the proposed acquisition of the company Cytec by Solvay.
Cytec, a company based in the United States and present in 11 countries, manufactures chemicals for the mining industry, as well as composite materials and adhesives for the aerospace and automotive sectors. The Belgian company Solvay is a global manufacturer of chemicals and plastics. These companies carry out complementary activities but, according to the Commission, do not operate at the same level of the supply chain. They are both present in the business for specialty chemicals for the mining and refining industries.
The Commission's investigation concentrated on the manufacture and supply of phosphor-based solvent extractants used in the mining and refining industries to separate cobalt from nickel. On this market, Solvay sells the product Ionquest 290 and Cytec offers Cyanex 272.
The Commission found that the merger operation would eliminate a significant competitive force in the market for phosphor-based solvent extractants. Internationally, there are very few alternative solutions available to customers in the refining sector, as existing competitors are small and their products' reputation not as strong as that of either Solvay or Cytec.
As this situation is likely eventually to lead to increased prices on this market, Solvay proposed to sell its activities on this market. It will sell the Ionquest brand and all related intellectual property rights. It will carry out a transfer of technology with the purchaser and provide it with assistance for the current production chain of Ionquest 290. It will transfer to the purchaser all customer contracts, purchase history and related information since the product entered the market. Solvay will conclude a temporary sub-contracting agreement to supply Ionquest 290 until the purchaser has set up its own manufacturing line. (Original version in French by Elodie Lamer)