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EU to probe PVC merger of INEOS, Solvay

11.05.2013  | 

The European Commission said the deal would remove a key competitor for bleach and for suspension PVC resin used to make pipes and window frames. Concessions offered by the companies “failed to provide a sufficiently clear-cut solution” to eliminate antitrust concerns, according to the EU.

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By AOIFE WHITE and ANDREW NOEL

Bloomberg

INEOS Group and Solvay, Europe’s two biggest makers of polyvinyl chloride, face an in-depth European Union (EU) probe into their 4.3 billion-euro ($5.8 billion) PVC merger, regulators said.

The European Commission said the deal would remove a key competitor for bleach and for suspension PVC resin used to make pipes and window frames, according to an e-mailed statement today.

Concessions offered by the companies “failed to provide a sufficiently clear-cut solution” to eliminate antitrust concerns, it said. The EU set a new deadline of March 21 to rule on the transaction.

The proposed combination, announced in May, would allow the enlarged business to cut costs in areas from transport to marketing and raise profitability amid a European industry suffering from inflated raw material and energy costs.

The PVC market is facing overcapacity and weak demand in Europe, prompting companies in the labor-intensive and power-hungry industry to explore mergers. Solvay has said it plans to exit the PVC venture at a later stage.



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