Could this result in Univar being forced to sell off the Quaron activities in France? The EU's statement (edited version below) certainly seems to make it quite clear that competition will be severely curtailed in France as a result of the deal.
The Commission found that Univar's acquisition of the Belgian and Dutch activities of Eurochem would not significantly impede effective competition in the European Economic Area (EEA).
At the same time, the Commission has referred the part of the proposed acquisition relating to Eurochem's activities in France to the French competition authority at its request. After a preliminary investigation, the Commission found that this part of the proposed transaction would threaten to significantly affect competition in the distribution of chemicals in France. Those aspects will now be examined by the French competition authority under national law.
On 5 February 2010, Univar and Eurochem, also known as Quaron, concluded an agreement according to which Univar would acquire all shares of Eurochem.
Univar, which is controlled by CVC Capital Partners, and Eurochem are both active in the distribution of commodities and specialities chemicals. CVC also controls Taminco and Evonik, which both produce and supply certain chemicals.
France asked the Commission to refer the part of the concentration concerning the French markets for the distribution of chemicals to the French competition authority, claiming that the proposed transaction would threaten to significantly affect competition in France.
The Commission's investigation confirmed that the proposed transaction would lead to significant overlaps in the distribution markets in France. For commodities, a majority of stakeholders raised concerns that the transaction could negatively affect competition in particular in Western France.
It would lead to a reduction of national players from three to two and would remove a significant competitive constraint on Univar and its main competitor Brenntag. At a national level, the merger would increase the symmetry between Brenntag and the merged entity, which could be an indication that coordinated effects might result from the merger. Following a market test of the remedies offered by the parties, the Commission concluded that they were not sufficient to remedy these concerns and bring into question its decision to refer the case to France.