European Commissioner for Competition Margrethe Vestager speaks during a media conference at EU headquarters in Brussels on Monday, March 27, 2017. The European Union has approved the proposed merger of Dow Chemical and Du Pont, saying that the companies' commitments to divest businesses have addressed its concerns. (AP Photo/Virginia Mayo)
Republished March 27, 2017 - 8:56 AM
Original Publication Date March 27, 2017 - 3:40 AM
BRUSSELS - The European Union approved the proposed merger of Dow Chemical and DuPont on Monday, declaring itself satisfied with commitments the companies have made to divest businesses.
Both plan to join in a $62 billion deal and then break apart into three separate, publicly traded companies. Those companies would focus on agriculture, material science, and the production and sale of specialty products.
EU antitrust chief Margrethe Vestager said the bloc's conditional approval ensures that the merger "does not reduce price competition for existing pesticides or innovation for safer and better products in the future."
The 28-nation bloc had raised concerns over the merger in the form originally proposed, but the EU's executive Commission said that "the commitments submitted by Dow and DuPont address these concerns in full."
Dow and DuPont said in February they were willing to divest more businesses to address regulators' concerns.
The companies will sell the DuPont pesticide businesses and "almost the entirety of DuPont's global R&D organization," the Commission said. Part of Dow's petrochemical business also will be sold — manufacturing facilities in Spain for acid copolymers and a contract through which it sources ionomers.
Dow is based in Midland, Michigan. DuPont has its headquarters in Wilmington, Delaware.
U.S. authorities are still examining the proposed merger.
The companies said in a statement that they "continue to work constructively with regulators in the remaining relevant jurisdictions to obtain clearance for the merger, which they are confident will be achieved."
They said that they believe the outcome of the EU review "is pro-competitive and maintains the strategic logic and value creation potential of the transaction."
News from © The Associated Press, 2017