Dow Chemical and DuPont have gained conditional EU antitrust approval for their $130-billion merger, but there are a number of conditions they need to meet.
One condition is the sale of some assets; another aims to retain research and development of new herbicides.
“We need effective competition in this sector so companies are pushed to develop products that are ever safer for people and better for the environment,” European Competition Commissioner Margrethe Vestager said in a statement.
“Our decision today ensures that the merger between Dow and DuPont does not reduce price competition for existing pesticides or innovation for safer and better products in the future.”
In return for the EU green light, DuPont will divest large parts of its global pesticides business, including its global research and development organization.
Dow in turn will sell two acid co-polymer manufacturing facilities in Spain and the United States, as well as a contract with a third party through which it buys ionomers. The company has already found a buyer - South Korea’s SK Innovation.
Antitrust experts said regulator’s demand to sell large swatches of R&D facilities could set the benchmark for future deals.
Sources said last week that ChemChina’s $43-billion bid for Syngenta could be approved this week but the timing could slip.
Bayer and Monsanto will also be seeking EU approval for their merger.