Commission européenne, DG COMP MERGER REGISTRY, 1049 Bruxelles, BELGIQUE  
Europese Commissie, DG COMP MERGER REGISTRY, 1049 Brussel,   BELGIË  
 
Tel: +32 229 -91111. Fax: +32 229 -64301. E -mail: COMP -MERG ER-REGISTRY@ec.europa.eu .  EUROPEAN COMMISSION  
Brussels,  27.7.2020  
C(2020 ) 5239 final  
PUBLIC VERSION  
 
To the notifying party  
Subject : Case M. 9736  – Lone Star/BASF Construction Chemicals (EB) business   
Commission decision pursuant to Article 6(1)(b) of  Council Regulation 
No 139/20041 and Article 57 of the Agreement on the European Economic 
Area2 
Dear Sir or Madam,  
(1) On 22 June 2020 , the European Commission received notification of a proposed 
concentration pursuant to Article 4 of the Merger Regulation by which  LSF11 
Skyscraper Investments S.à r.l. (Luxembourg), an indirect subsidiary of Lone Star 
Fund XI, L.P. (“LSF XI”, Bermuda ),  and belonging  to the global private equity 
group Lone Star Funds (“Lone Star”, USA) acquires within the meaning of Article 
3(1)(b) of the Merger Regulation  control of the whole of BASF’s construction 
chemicals business (“BASF’s EB business”, Germany) .3 Lone  Star is referred to as 
“the Notifying Party” and, together with BASF’s EB business, as “the Parties”.  
                                                 
1  OJ L 24, 29.1.2004, p. 1 (the “Merger Regulation ”). With effect from 1 December 2009,  the Treaty on the 
Functioning of the European Union ( “TFEU ”) has introduced certain changes, such as the replacement of  
“Community ” by “Union ” and “common market ” by “internal market ”. The terminology of the TFEU will 
be used throughout this decision.  
2  OJ L 1, 3.1.1994, p. 3 (the “EEA Agreement”).  
3  Publication in the Official Jou rnal of the European Union No C 217, 1.7.2020, p. 18.  
In the published version of this decision, 
some information has been omitted 
pursuant to Article 17(2) of Council 
Regulation (EC) No 139/2004 concerning 
non-disclosure of business secrets and other  
confidential information. The omissions are 
shown thus […] . Where possible the 
information omitted has been replaced by 
ranges of figures or a general description.  
 
2 1. THE PARTIES  
(2) Lone Star is a private equity firm that invests globally in real estate, equity, credit 
and other financial assets. Two of the companies cont rolled by Lone Star are of 
interest in the case at hand, namely Xella International S.A. (“Xella” , Germany ) and 
Stark  Group A/S (“Stark” , Denmark ). Xella is a producer of autoclaved aerated 
concrete (“AAC” ) products in the EEA. Stark is a building materials distributor in 
the Nordic countries and Germany.  
(3) BASF’s EB4 business  produces and distributes admixture systems and construction 
systems for new constructions, maintenance, repair and renovation of resid ential and 
commercial buildings, as well as infrastructure. BASF’s EB business has two main 
lines of business, namely (i) EBA5, which is speciali sed in the manufacture of 
additives for concrete and other cementitious materials and (ii) EBC6, which 
produces  concrete repair and protection systems, performance grouts, waterproofing 
systems, sealants, performance flooring systems, wall systems and coatings for 
mulch and wood fibres.  
2. THE OPERATION  AND THE CONCENTRATI ON 
(4) On 21 December 2019, the Parties  entered in to a sales and purchase agreement 
pursuant to which BASF’s EB business will be transferred to the Notifying Party. 
The Transaction will be accomplished by way of purchase of shares.  
(5) Following completion of the Transaction, the Notifying Party will thus acq uire sole 
control of BASF’s EB business. The Transaction is therefore a concentration within 
the meaning of Article 3(1)(b) of the EU Merger Regulation.  
3. EU DIMENSION  
(6) The undertakings concerned have a combined aggregate world -wide turnover of 
more than EUR 5 000 million  (Lone Star: EUR […] million; BASF’s EB business: 
EUR […] million)7. Each of them has an EU -wide turnover in excess of EUR 250 
million  (Lone Star: EUR […] million; BASF’s EB business: EUR […] million) , but 
they do not achieve more than two -thirds of their aggregate EU -wide turnover within 
one and the same Member State. The notified operation therefore has a Union 
dimension.   
4. MARKET  DEFIN ITIONS   
4.1. Introduction  
(7) BASF’s EB business is active in the manufact ure of polymer -based concrete 
admixtures (through EBA), as well as mortars and several other specialty 
construction products (through EBC).  
                                                 
4  “E” is a BASF organisational code. “B” stands for “Bauchemie” . 
5  “A” stands for “Admixtures” . 
6  “C” stands for “Construction Systems”.  
7  Turnover calculated in accordance with Article 5 of the Merger Regulation . 
 
3 (8) Xella, one of the companies currently under the control of Lone Star, is active in the 
production of construction ma terials, and in particular the following products:  
(a) autoclaved aerated concrete (“AAC”) blocks; which are a lightweight, 
precast, foam concrete building material made of autoclaved aerated concrete 
which can be lifted by hand and do not require equipment fo r handling;  
(b) AAC large format prefabricated compound units; which are made of the 
same material as AAC blocks, but require equipment such as cranes for 
handling;  
(c) Aerated concrete roofing panels, fire walls and outer walls; which are a sub -
category of AAC la rge format prefabricated compound units that are 
specifically used for roofing, walls, as well as fire walls applications;  
(d) Mineral insulation boards; which are niche insulation products suitable for 
special types of applications;  
(e)  calcium silicate units (“ CSU”); which are masonry product units made from 
a mixture of lime and natural siliceous materials (sand, siliceous gravel or 
rock or mixtures thereof);8  
(f) Mortars .9 
(9) In this Decision, AAC large format prefabricated compound units will be referred to 
as “AAC  large format units” for concision’s sake, and, together with AAC blocks as 
“AAC products”.  
(10) Xella’s activities were examined closely in three recent Commission decisions all 
related to Lone Star.10  
(11) Stark is active in the distribution of building products at retail level, to both 
professional and non -professional customers.  
(12) The Transaction gives thus rise to different horizontal and vertical overlaps between 
the activities of BASF’s EB business, Xella and Stark.  
4.2. Concrete admixtures  
(13) Concrete admixtures are used to modify the properties of concrete and to provide it 
with some specific qualities. Concrete admixtures include air entrainers, water 
reducers, accelerators, retardants as well as plastici sers.  
                                                 
8  Since concrete admixtures are not used in the manufacture of CSUs, CSUs are not vertically linked to any 
products manufactured by BASF’s EB business. As a result, CSUs will not be discussed further in this 
Decision.  
9  Xella does not produce and market mortar as a stand -alone product, but only as part of complete solutions 
involving its aerated concrete products. Moreover, these mortars are specially adapted to the needs of 
Xella’s AAC blocks, CSUs and mineral insulation boards, and sold at a higher price than the 
commoditi sed types of mort ars, which account for t he majority of mortars sales. See Form CO, paragraph 
74. 
10  M.9406 – Lone Star – Stark group / Saint -Gobain BDD; M.8733 – Lone Star/Stark; and M.8341 – Lone 
Star Fund/Xella International.  
 
4 4.2.1.  Product market definition  
4.2.1.1.  Commission precedents  
(14) In the past,11 the Commission found that chemical -based and mineral -based 
admixtures constitute separate product markets.  
(15) The Commission excluded any further segmentation of chemical -based and mineral -
based admixtures. In particular, the Commission excluded the relevance of a 
potential distinction between different uses of admixtures (such as concrete 
admixtures, cement admixtures or mortar admixtures) because of a high degree of 
supply side substitutability between the different chemi cal admixtures  for those 
uses.12 
4.2.1.2.  The Notifying Party’s view  
(16) The Notifying Party points out that BASF’s EB business is only active in chemical -
based (and in particular polymer -based) concrete admixtures, thus belonging to the 
wider market of chemical admixtu res.13 None of the companies controlled by Lone 
Star is active in the manufacture of concrete admixtures.   
(17) The Notifying Party agrees with the Commission’s precedents, and provided 
BASF’s EB business’ market shares in the market of chemical -based admixtures .14 
4.2.1.3.  Results of the market investigation and conclusion  
(18) Admixture customers15 and competitors16 confirmed that chemical -based admixtures  
are not substitutable with other products and therefore constitute a distinct product 
market. Both admixture customers17 and competitors18 also confirmed that no further 
segmentation of chemical -based admixtures  by use or sub-category is necessary. In 
light of the above and for the purposes of the assessment of the Transaction, the 
Commission considers that chemical -based  admixt ures constitute a separate product 
market, distinct from the market for mineral -based  admixtures, and that no further 
segmentation is necessary.  
                                                 
11  See Cases M.7498 – Compagnie de Saint Gobain/Sika  and M.4177 - BASF/Degussa Construction 
Chemicals.  
12  See  Cases M.7498 – Compagnie de Saint Gobain/Sika , recital 104  
13  Form CO, paragraph 125  
14  Form CO, paragraph 127  
15  See replies to  question 8  of Q1 – Questionnaire to admixtures customers . 
16  See replies to question 6 of Q2 – Questionnaire to admixtures competitors  and to question 7 , Q4 - 
Questionnaire to admixtures customers active in mortars and sealants . 
17  See replies to  question 9 of Q1 – Questionnaire to admixtures customers . 
18  See r eplies to question 7 of Q2 – Questionnaire to admixtures competitors  and to question 8 of Q4 - 
Questionnaire to admixtures customers active in mortars and sealants . 
 
5 4.2.2.  Geographic market definition  
4.2.2.1.  Commission precedents  
(19) In the past,19 the Commission has left open whether the relevant geographic market 
for concrete admixtures was EEA -wide or narrow er, and has analysed competition 
on the basis of national markets as the narrowest plausible market definition.  
4.2.2.2.  The Notifying Party’s view  
(20) The Notifying Party does not express a view on the relevant geographic market for 
chemical -based admixtures, but provided BASF’s EB business’ market shares in 
chemical -based admixtures at national level.  
4.2.2.3.  Results of the market investigation and conclusion  
(21) Replies of admixture customers and competitors indicate that the market may be 
wider than national. Responding customers are somewhat split between a regional 
market (a cluster of neighbouring countries), an EEA -wide  market, or even a 
worldwide market.20 The majority of r esponding competitors see the market as 
worldwide.21 Ultimately, the question of whether the appropriate geographic market 
definition is national, or wider (regional, EEA -wide or  worldwide)  can be left open, 
as the Commission considers that the  Transaction does not raise serious doubt s for 
either geographic market definition.  In this decision, the Commission will carry out 
its assessment on a national market basis as the narrowest plausible geographic 
market definition , this being the most conse rvative approach, since BASF EB 
business’ market shares would be lower under any broader geographic market 
definitions  for chemical -based admixtures .  
4.3. Mortars  
4.3.1.  Product market definition  
4.3.1.1.  Commission precedents  
(22) In the past, the Commission has made a distincti on between premix mortars, which 
are mixed at the factory and on -site mortars, which are mixed on the construction 
site.22 Within premix mortars, the Commission has distinguished between dry 
mortars (supplied in a dry powder form), wet mortars (ready -mixed with water at the 
factory), and ready -to-use paste mortars (supplied as paste, including organic 
compounds as binders.23 Moreover , the Commission has also distinguished between 
mortars based on the application, namely: (i) construction mortars, used for various 
building construction purposes , such as casting and setting, masonry, plastering, 
floor levelling and concrete repair; (ii) façade mortars, used as an outer layer of 
                                                 
19  See Cases M.7498 – Compagnie de Saint Gobain/Sika  and M.4177 - BASF/Degussa Construction  
Chemicals.  
20  See replies to question 21a of  Q1 – Questionnaire to admixtures customers . 
21  See replies to question 8 of Q2 – Questionnaire to admixtures competitors . 
22  See Cases M.9276 - Sika/Financière Dry Mix Solutions,  M.7498 – Compagnie de Saint -Gobain/Sika , 
M.4898 – Compagnie de Saint -Gobain/Maxit  and M.3572 – Cemex/RMC.  
23  See Cases M.9276 - Sika/Financière Dry Mix Solutions,  M.7498 – Compagnie de Saint -Gobain/Sika  and 
M.4898 – Compagnie de Saint -Gobain/Maxit . 
 
6 buildings for protective or aesthetic purposes, or as part of insulation systems a nd 
(iii) tile -fixing mortars used for fixing tiles, both on substrate (adhesive mortars) and 
as sealants between tiles (grouts).24  
4.3.1.2.  The Notifying Party’s view  
(23) The Notifying Party does not express a view on the relevant product market for 
mortars.  
4.3.1.3.  Results of the market investigation and conclusion  
(24) Replies in the market investigation of competitors25 active in  mortars confirmed the 
relevance of the Commission’ precedents in this respect , as well as the absence of a 
need to further sub -segment the market . 
(25) The questions of whether the appropriate product market definition is mortars as a 
whole or whether separate product markets exist for any of the segmentations listed 
in paragraph  (22), which were considered in previous decisions, can be left open, as 
the Commission finds that no serious doubt s arise for any of the possible product 
market definitions.  
4.3.2.  Geographic market definition  
4.3.2.1.  Commission precedents  
(26) In the past, the Commission left the geographic market definition open and 
conducted the competitive assessment both at national and at local/regional levels, 
assuming a 120 km radius around the production plant.26 In its most recent 
decisional practice, the C ommission has carried out its competitive assessment on 
the basis of national markets but, with regard to large volume/low value heavy 
mortars, it has also considered narrower hypothetical regional/local markets, 
assuming a 120 km radius around production plants.27 
4.3.2.2.  The Notifying Party’s view  
(27) The Notifying Party does not express a view on the relevant geographic market for 
mortars, but explains that the types of mortars sold by BASF’s EB business, as well 
as Xella , do not fall under the category of large volume/low value heavy mortars, for 
which the competitive assessment should be carried out on the basis of a 120 km 
radius around production plants, and consequently provide the Parties’ market shares 
for mortars at  national level only.28 
                                                 
24  See Cases M.9276 - Sika/Financière Dry Mix Solutions,  M.7498 – Compagnie de Saint -Gobain/Sika , 
M.7249  – CVC/Parexgroup  and M.4898 – Compagnie de Saint -Gobain/Maxit . 
25  See replies to questions 5-8 of Q3 – Questionnaire to mortars and sealants competitors  and questions 9 -
12 of Q4 - Questionn aire to admixtures customers active in mortars and sealants . 
26  See Cases M.7249 – CVC/Parexgroup , M.4898 – Compagnie de Saint -Gobain/Maxit , M.4719 – 
Heidelberg Cement/Hanson  and M.1779 – Anglo American/Tarmac . 
27  See Cases M.9276 - Sika/Financière Dry Mix  Solutions  and M.7498 – Compagnie de Saint -Gobain/Sika.  
28  Form CO, paragraph 73  
 
7 4.3.2.3.  Results of the market investigation and conclusion  
(28) The majority of the replies in the market investigation of competitors29  active in  
mortars showed that the geographic scope for these products would be national.  In 
light of the abov e and for the purposes of the assessment of the Transaction, the 
Commission considers that the market for mortars other than large volume/low value 
heavy mortars (which are of no relevance in the case at hand) could be national in 
scope. In any event, the precise geographic market definition can be left open, as the 
Transaction does not raise serious doubt s under any plausible market definition  (see 
paragraph s (22) and (26) above) . 
4.4. AAC blocks  
4.4.1.  Product market definition  
4.4.1.1.  Commission precedents  
(29) In the past, the Commission found that AAC blocks form a single relevant product 
market, which is not likely to comprise other products.30 No further sub -
segmentation was considered.31 
4.4.1.2.  The Notifying Party’s view  
(30) The Notifying Party considers that the product market definition for AAC blocks 
should encompass other products, such as aggregate blocks and potentially also other 
wall-building materials, in particular bricks, sand -lime bricks/calcium silicate units 
and pumice blocks.32 The Notifying Party, however, considers that the exact product 
market can be left open.33 
4.4.1.3.  Results of the market investigation and conclusion  
(31) Responses of AAC competitors  suggest  that AAC blocks may be  substitutable with 
some other products34 and could  thus be part of a broader product market including 
those other products as well .35 AAC competi tors also took the view that no further 
sub-segmentation of AAC blocks by type or category was necessary.36 
(32) In light of the above and for the purposes of the assessment of the Transaction, the 
Commission considers that the question of whether AAC blocks con stitute a separate 
product market or are part of a wider market also encompassing products such as 
                                                 
29  See to replies to question 9 of Q3 - Questionnaire to admixtures competitors active in mortars and 
sealants  and question  14 of Q4 - Questionnaire to admixtures customers active in mortars and sealants . 
30  See Cases M.8341 – Lone Star Fund/Xella International ; M.8733  – Lone Star/Stark and M.9406  – Lone 
Star – Stark group / Saint -Gobain BDD  
31  See Cases M.8341 – Lone Star Fund/Xella International ; M.8733  – Lone Star/Stark and M.9406  – Lone 
Star – Stark group / Saint -Gobain BDD  
32  Form CO, paragraph 37  
33  Form CO, paragraph 38  
34  See replies to question 10 of  Q1 – Questionnaire to admixtures customers . 
35  See replies to question 10.1 of  Q1 – Questionnaire to admixtures customers . Potential substitutes 
mentioned by respo ndents include  “[…] Dense Concrete blocks, CSU, clay blocks and timber framed 
structures  […]”; “[...] brick, sand -lime brick  […]”; “[…] calcium silicate or clay bricks  [...]”; “[…] 
clay bricks – ceramic, p recast concrete elements, wood panels, etc  […].”. 
36  See replies to question 1 1 of Q1 – Questionnaire to admixtures customers . 
 
8 clay bricks, clay blocks, aggregate blocks, dense concrete blocks, CSU and other 
building products can be left open, as the Commission considers that the Tra nsaction 
does not raise  competitive concerns under either product market definition. The 
Commission also considers that no further segmentation of AAC blocks is necessary. 
For the purposes of this decision , the Commission will carry out its assessment on 
the basis of a market restricted to AAC blocks only as the narrowest plausible 
product market definition , this being the most conservative approach, since Xella’s 
market shares would be lower under  any broader product market definitions for 
AAC blocks   
4.4.2.  Geographic market definition  
4.4.2.1.  Commission precedents  
(33) In the past, the Commission found that the relevant geographic market for AAC 
blocks was local  in scope and examined the market for AAC blocks in Germany 
under four separate regions (North Germany, West Germany, South Germany and 
East Germany).37 
4.4.2.2.  The Notifying Party’s view  
(34) The Notifying Party submits that the geographic market for AAC blocks is at l east 
national in scope.38 
4.4.2.3.  Results of the market investigation and conclusion  
(35) Responses of AAC competitors  took the view that the geographic scope of the AAC 
blocks market is narrower than national.39 
(36) Ultimately, the question whether the appropriate geographi c market definition is 
national or local (smaller than national) can be left open, as the Commission 
considers that the Transaction does not raise serious doubts  for either geographic 
market definition.  
4.5. AAC large format units and aerated concrete roofing p anels, fire walls and 
outer walls  
4.5.1.  Product market definition  
4.5.1.1.  Commission precedents  
(37) AAC large format units and aerated concrete roofing panels, fire walls and outer 
walls were examined by the Commission in Case M.9406  – Lone Star – Stark group 
/ Saint -Gobai n BDD. In this case, the Commission found that aerated concrete 
roofing panels, fire walls and outer walls were part of the same market as AAC large 
format units. The Commission also found indications that AAC large format units 
for industrial construction are not substitutable with those for residential 
                                                 
37  See Cases M.8341 – Lone Star Fund/Xella International ; M.8733  – Lone Star/Stark and M.9406  – Lone 
Star – Stark group / Saint -Gobain BDD  
38  Form CO, paragraph 39  
39  See replies to question 21 of  Q1 – Questionnaire to admixtures customers . 
 
9 construction . However, the Commission ultimately left the exact product definition 
for AAC large format prefabric ated compound units open.  
4.5.1.2.  The Notifying Party’s view  
(38) The Notifying Party agrees that AAC large format units for industrial construction 
are not substitutable with those for residential construction, but considers that each 
of them form part of a broader pr oduct market. More specifically, the Notifying 
Party submits that AAC large format units for industrial construction form part of a 
market that also encompasses concrete panels and steel elements (but not elements 
made of in situ  poured concrete which is n ot a usual method of producing panels for 
industrial buildings) and that AAC large format units for residential construction 
form part of a market that also encompasses concrete floor elements and full 
assembly floors out of reinforced concrete.40 
4.5.1.3.  Results o f the market investigation and conclusion  
(39) Responses of AAC competitors  indicate that AAC large format units are 
substitutable with some other products41 and could thus be part of a broader product 
market including those other products42 as well . They also re plied that no further 
sub-segmentation of AAC large format units  by type or category was necessary.43 
(40) Concerning aerated concrete roofing panels, firewalls  and outer walls , AAC 
competitors  confirmed that they are part of the market for AAC large format 
prefabricated compound units,44 and that no further -sub-segmentation would be 
necessary.45 
(41) In light of the above and for the purposes of the assessment of the Transaction,  the 
Commission consid ers that the question of whether AAC large format units 
constitute a separate product market comprising aerated concrete roofing panels, fire 
walls and outer walls or are part of a wider market also encompassing products such 
as AAC blocks, prefabricated c oncrete panels or steel panels can be left open, as the 
Commission considers that the Transaction does not raise serious doubt s under either 
product market definition. The Commission also considers that the question of 
whether a further sub -segmentation be tween AAC large format units for industrial 
construction and AAC large format units for residential construction is appropriate 
can be left open, as the Commission finds that the Transaction does not raise serious 
doubts  under any product market definition  set out above , this being the most 
conservative approach, since any wider product  market definition for AAC large 
format units would lower Xella’s market shares .  
                                                 
40  Form CO, paragraphs 47 - 53 
41  See replies to question 12 of  Q1 – Questionnaire to admixtures customers . 
42  See replies to question 12.1 of  Q1 – Questionnaire to admixtures customers . Potential substitutes 
mentioned by respondents include AAC blocks, as well as prefabricated concrete or steel panels.  
43  See replies to question 1 4 of Q1 – Questionnaire to admixtures customer s. 
44  See rep lies to question 1 3 of Q1 – Questionnaire to admixtures customers . 
45  See replies to question 1 4 of Q1 – Questionnaire to admixtures customers . 
 
10 4.5.2.  Geographic market definition  
4.5.2.1.  Commission precedents  
(42) In Case M.9406  – Lone Star – Stark group / Saint -Gobain BDD , the Commission 
left open whether the relevant geographic market for AAC large format units should 
be considered as local or national in scope.  
4.5.2.2.  The Notifying Party’s view  
(43) The Notifying Party submits that the relevant geographic market i s national.46 
4.5.2.3.  Results of the market investigation and conclusion  
(44) Responses of AAC competitors  in the market investigation confirmed th at the 
geographic scope of the AAC large format prefabricated compound units , as well as 
for aerated concrete roofing panels, firewalls  and outer walls market s are narrower 
than national. 47 
(45) Ultimately, the question whether the appropriate geographic market definition is 
national or local (smaller than national) can be left open, as the Commission 
considers that the Transaction does not raise serious doubts  for either geographic 
market definit ion. 
4.6. Mineral insulation boards  
4.6.1.  Product market definition  
4.6.1.1.  Commission precedents  
(46) The product market definition for mineral insulation boards has not been examined 
in any Commission precedent  so far . 
4.6.1.2.  The Notifying Party’s view  
(47) The Notifying Party considers th at mineral insulation boards are part of a broader 
market encompassing other solution for interior and exterior insulation of buildings.  
The Notifying Party nonetheless explains that the exact product market definition for 
mineral insulation boards can be left open since Xella’s market shares would not 
exceed 20% under any plausible product or geographic market definition.48 
4.6.1.3.  Results of the market investigation and conclusion  
(48) Mineral insulation boards manufacturers  indicated that mineral insulation boards are  
substitutable with some other insulation products49 and could thus be part of a 
broader product market including those other products50 as well . They also replied 
                                                 
46  Form CO, paragraphs 54 – 55  
47  See replies to question 21 of  Q1 – Questionnaire to admixtures customers . 
48  Form CO, paragraph 59  
49  See replies to question 12 of  Q1 – Questionnaire to admixtures customers . 
50  See replies to question 15.1 of  Q1 – Questionnaire to admixtures customers . “Mineral wool insulation 
board can readily be replaced in many applications wi th various types of plastic foam insulation boards 
just as there are a number of other insulation products, like aerogel, cellulose, vacuum panels, natural 
 
 
11 that no further sub -segmentation of mineral insulation boards  by type or category 
was necessary.51 
(49) In light of the above and for the purposes of the assessment of the Transaction, the 
Commission considers that the question of whether mineral insulation boards 
constitute a separate product market or are part of a wide r market also encompassing 
other insulation products can be left open, as the Commission considers that the 
Transaction does not raise serious doubt s under either product market definition. The 
Commission also considers that no further segmentation of mine ral insulation boards 
is necessary. In this decision, the Commission will carry out its assessment on the 
basis of a market restricted to mineral insulation boards only as the narrowest 
plausible product market definition , this being the most conservative approach  (as 
indicated by the market investigation) , since any wider product market definition for 
mineral insulation boards w ould lower Xella’s market shares.  
4.6.2.  Geographic market definition  
4.6.2.1.  Commission precedents  
(50) The geographic market definition for mineral  insulation boards has not been 
examined in any Commission precedent  so far . 
4.6.2.2.  The Notifying Party’s view  
(51) The Notifying Party believes that the relevant geographic market for mineral 
insulation boards is national in scope.52 
4.6.2.3.  Results of the market investigatio n and conclusion  
(52) Replies of mineral insulation boards manufacturers  indicate that the geographic 
scope for mineral insulation boards is national, or even wider.53 
(53) In light of the above and for the purposes of the assessment of the Transaction, the 
Commissio n considers that the question whether the appropriate geographic market 
definition is national, or wider (regional or EEA -wide) can be left open, as the 
Commission considers that the Transaction does not raise serious doubts  for either 
geographic market de finition. In this decision, the Commission will carry out its 
assessment on a national market bas e as the narrowest plausible geographic market 
definition , this being the most conservative approach  (as confirmed by the market 
investigation) , since any wide r geographic market definition,  mineral insulation 
boards w ould lower Xella’s market shares.  
                                                                                                                                                      
products like straw etc that in some applications can replace mineral wool insulation boards ”; “Mayb e 
other materials are possible, if the architect or the costomer prefer  other insulation products. ” ; “There 
are mineral insulation boards that can be substitutable with ”. 
51  See replies to question 1 6 of Q1 – Questionnaire to admixtures customers . 
52  Form  CO, paragraph 60.  
53  See replies to question 21  of Q1 – Questionnaire to admixtures customers . 
 
12 4.7. Distribution of building products  
4.7.1.  Product market definition  
4.7.1.1.  Commission precedents  
(54) In its previous decisions, the Commission considered that the markets for the 
distribution of building materials in general can be divided into: (i) wholesale sales 
to retailers; (ii) retail sales to professional customers (B2B); and (iii) retail sales to 
non-professional customers (primarily through DIY stores), but left the precis e 
product market definition ultimately open.54 
4.7.1.2.  The Notifying Party’s view  
(55) The Notifying Party considers the above -mentioned product market segmentation to 
be conceivable, but nonetheless considers that it improperly reflects the real 
condition of the market. The Notifying Party considers in particular that distributors 
of construct ion materials do not keep track  of their sales based on such a 
segmentation.55 
4.7.1.3.  Results of the market investigation and conclusion  
(56) Replies of distributors of building materials  fully confirmed the Commission’s 
precedents regarding the product market definitions for the distribution of building 
products.56 
(57) Ultimately, the question of whether further sub -segmentation of the distribution of 
building material, between (i) wholesale s ales to retailers; (ii) retail sales to 
professional customers (B2B); and (iii) retail sales to non -professional customers 
(primarily through DIY stores) is appropriate  or not  can be left open, as the 
Commission finds that the Transaction does not raise se rious doubts  under any 
product market definition set out above.  
4.7.2.  Geographic market definition  
4.7.2.1.  Commission precedents  
(58) The Commission has previously considered that the scope of the market for the 
distribution of building products as well as its potential sub -segments (retail sales to 
professional customers and retail sales to non -professional customers) is either 
national or potentially smaller than national.57 
                                                 
54  See Cases M.9406  – Lone Star – Stark group / Saint -Gobain BDD ; M.7910 – Kesko/Onninen ; M.7703 – 
PontMeyer/DBS ; M.3407 – Saint Gobain/Dahl  and M.3142 – CVC/Danske Traelast . 
55  Form CO, paragraph 101.  
56  See replies to question s 19 and 20 of  Q1 – Questionnaire to admixtures customers . 
57  See Cases M.9406  – Lone Star – Stark group / Saint -Gobain BDD  and M.7910 – Kesko/ Onninen . 
 
13 4.7.2.2.  The Notifying Party’s view  
(59) The Notifying Party submits that while the geographic market might exhibit  both 
some national and some regional features, the vertical nature of this case would 
make it appropriate to consider these markets on a national basis only.58 
4.7.2.3.  Results of the market investigation and conclusion  
(60) Replies of distributors  of building materials  showed clearly that the market for the 
distribution of building products is narrower than national, both for professional and 
for retail customers.59 
(61) Ultimately, the question whether the appropriate geographic market definition is 
national or local (smalle r than national) can be left open, as the Commission 
considers that the Transaction does not raise serious doubts  for either geographic 
market definition.  
5. COMPETITIVE ASSESSMEN T 
5.1. Overview of affected markets  
(62) The Transaction does not give rise to any horizon tally affected markets.  
(63) The Transaction however gives rise to several affected vertical links, that can be 
classified under three main categories, namely  
(i) the vertical relationships between polymer -based concrete admixtures 
manufactured by EBA (upstream) and the manufacture and sales of various 
building and insulation materials (downstream) in 19 EEA countries (18 
Member States60 plus Norway) performed by Xella;  
(ii) the vertical relationships between polymer -based concrete admixtures 
manufactured by EBA (upstream) and the sales of building materials to 
professional and retail customers (downstream) in 4 EEA countries ( three 
Member States61 plus Norway) performed by Stark; and  
(iii) the vertical relationships between mortars and several other specialty 
construc tion products manufactured by EBC (upstream) and the sale of building 
materials to professional and retail customers (downstream) in two EEA 
countries (Denmark and Norway) performed by Stark.  Table 1  below 
summarises all these vertical links by category.  
  
                                                 
58  Form CO, paragraph 103  
59  See replies to question 21  of Q1 – Questionnaire to admixtures customers . 
60  Austria, Belgium, Bulgaria, Croatia, Czech Republic, Denmark, Finland, France, Germany, Hungary, 
Italy, Netherlands, Poland, Romania, Slovakia, Slovenia, Spain and Sweden  
61  Denm ark, Finland and Sweden  
 
14 Table 1: vertically affected markets, sorted by category.  
Category  Upstream product / 
supplied by  Downstream product 
/ supplied by  Geographic 
level 
affected 
upstream  Geographic level 
affected downstream  
Category 1:  
Vertical relationships between 
polymer -based concrete 
admixtures manufactured by 
EBA (upstream) and the 
manufacture and sales of 
various building and insulation 
materials (downstream) in 19 
EEA countries (18 Member 
States plus Norway) performed 
by Xella  Chemical -based 
admixtures  / BASF’s 
EB business  AAC62 blocks / Xella  
Austria  
Czech 
Republic  
Denmark  
Norway  
 Spain  
Sweden  15 Member States + 
Norway  
Chemical -based 
admixtures  / BASF’s 
EB business  AAC large format 
units / Xella  12 Member States + 
Norway  
Chemical -based 
admixtures  / BASF’s 
EB business  Mineral insulation 
boards / Xella  None  
Chemical -based 
admixtures  / BASF’s 
EB business  Aerated concrete 
roofing panels / Xella  12 Member States + 
Norway  
Chemical -based 
admixtures  / BASF’s 
EB business  Mortars / Xella  None  
Category 2:  
Vertical relationships between 
polymer -based concrete 
admixtures manufactured by 
EBA (upstream) and the sales 
of building materials to 
professional and retail 
customers (downstream) in 4 
EEA countries (3 Member 
States plus Norway) performed 
by Stark  Chemical -based 
admixtures  / BASF’s 
EB business  Distribution of 
building materials to 
professional customers 
/ Stark  Denmark  
Norway  
 Sweden  At regional level in 
Denmark and Norway, in 
the regions of Denmark 
capital and Central 
Jutland, as well as 
Norway Troms og 
Finnmark and Sogn og 
Fjordane, and probably 
also in Finland, where 
Stark holds a market share 
of [20-30]% at national 
level (no regio nal market 
shares provided)  
Chemical -based 
admixtures  / BASF’s 
EB business  Distribution of 
building materials to 
retail (DIY) customers 
/ Stark  At regional level in some 
regions of Denmark and 
Norway, as well as 
Finland probably (see 
above).  
Category 3: 
Vertical relationships between 
mortars and several other 
specialty construction products 
manufactured by EBC 
(upstream) and the sales of 
building materials to 
professional and retail 
customers (downstream) in 2 
EEA countries (Denmark and 
Norway) perform ed by Stark  Mortars / BASF’s EB 
business  Distribution of 
building materials to 
professional customers 
/ Stark  - At regional level in some 
regions of Denmark and 
Norway, as well as 
Finland probably (see 
above).  
Mortars / BASF’s EB 
business  Distribution of  
building materials to 
retail (DIY) customers 
/ Stark  - At regional level in some 
regions of Denmark and 
Norway, as well as 
Finland probably (see 
above).  
Other products 
manufactured by EBC 
/ BASF’s EB business  Distribution of 
building materials to 
professional customers 
/ Stark  - At regional level in some 
regions of Denmark and 
Norway, as well as 
Finland probably (see 
above).  
Other products 
manufactured by EBC 
/ BASF’s EB business  Distribution of 
building materials to 
retail (DIY) customers 
/ Star k - At regional level in some 
regions of Denmark and 
Norway, as well as 
Finland probably (see 
above).  
 
                                                 
62  Autoclaved aer ated concrete . 
 
15 5.2. Framework of the competitive assessment of  vertical links  
(64) The Commission’s Guidelines on the assessment of non -horizontal mergers under 
the Merger Regulation (the "Non -Horizontal Merger Guidelines") distinguish 
between two main ways in which vertical mergers may significantly impede 
effective competition, namely input foreclosure and customer foreclosure.63  
(65) For a merger to raise input foreclosure competition concerns, the merged entity must 
have a significant degree of market power upstream.64 In assessing the likelihood of 
an anticompetitive input foreclosure stra tegy, the Commission has to examine 
whether (i) the merged entity would have the ability to substantially foreclose access 
to inputs ; (ii) whether it would have the incentive to do so; and (iii) whether a 
foreclosure strategy would have a significant detri mental effect on competition 
downstream.65  
(66) For a merger to raise customer foreclosure competition concerns, the merged entity 
must be an important customer with a significant degree of market power in the 
downstream market.66 In assessing the likelihood of an anticompetitive customer 
foreclosure strategy, the Commission has to examine whether  (i) the merged entity 
would have the ability to foreclose access to downstream markets by reducing its 
purchases from its upstream rival s; (ii) whether it would have the incentive to do so; 
and (iii) whether a foreclosure strategy would have a significant detrimental effect 
on consumers in the downstream market.67  
5.3. Vertical relationships between polymer -based concrete admixtures (upstream) 
and the manufacture and sales of various building and insulation materials 
(downstream)  
(67) BASF’s EB business, through its EBA business, manufactures chemical -based 
admixtures . Some of these products (as well as the ones manufactured by BASF’s 
EB business ups tream competitors) are used in the manufacture of several building 
and insulation materials manufactured by Xella.  
(68) This vertical link gives rise to markets that are affected upstream at national level in 
six EEA countries (Austria, Czech Republic, Denmark , Norway, Spain and Sweden) 
because BASF’s EB business’ market shares in the sale of chemical -based 
admixtures  is above 30% in these countries, as well as markets that are affected 
downstream in 19 EEA countries68 for most products sold by Xella (AAC blocks , 
                                                 
63  OJ L 24, 29.1.2004, p. 1.  
64  Non-horizontal Merger Guidelines, paragraph 35.  
65  Non-horizontal Merger Guidelines, paragraph 32 . 
66  Non-horizontal Merger Guidelines, paragraph 61.  
67  Non-horizontal Merger Guidelines, paragraph 59.  
68  Austria, Belgium, Bulgaria, Croatia, Denmark, France, Germany, Hungary, Italy, Netherlands, Romania, 
Slovakia, Slovenia, Spain , Sweden  and  Norway for AAC blocks; Austria, Belgium, Czech Republic, 
Denmark,  Finland, France, Germany, Hungary, Netherlands, Poland, Slovakia, Slovenia, Sweden  and 
Norway, for AAC large format units and Austria, Czech Republic, Denmark, Norway, Spain , Sweden  and 
Norway for mineral insulation boards.  
 
16 AAC large format units  and mineral insulation boards, but not for mortars ), because 
Xella’s market shares are above 30% for these products.69 
(69) Table 2 below provides an overview of these vertical relationships. Countries where 
Xella has manufacturing plants for the manufacture of a given product are marked by 
an asterisk “*” at the end of the corresponding line . Market shares below the 30% 
threshold are marked with a  “-“. 
Table 2: overview of the vertical relationships between chemical -based admixtures 
manufactured by EBA (upstream) and the manufacture and sales of various building and 
insulation materials (downstream)  (for 2019)  
Relevant 
geographic 
markets  BASF’s EB 
business’s 
market share 
upstream in the 
sales of 
chemical 
admixtures  
(on the basis of 
value of sales, 
EUR)  Xella’s market 
shares 
downstream for 
AAC blocks  (on 
the basis of 
volume of sales 
m3) Xella’s market 
shares 
downstream  for 
AAC large 
format 
prefabricated 
compound units  
(on the basis of 
volume of sales 
m3) Xella’s market 
shares 
downstream  for 
mineral 
insulation 
boards  (on the 
basis of volume 
of sales m3) Xella’s market 
shares 
downstream for 
mortars70 (on 
the basi s of 
volume of sales 
m3) 
Austria  
Belgium  
Bulgaria  
Croatia  
Czech Republic  
Denmark  
Finland  
France  
Germany  
Hungary  
Italy  
Netherlands  
Norway  
Poland  
Romania  
Slovakia  
Slovenia  
Spain  
Sweden  [40-50]%  
[0-5]%  
[0-5]%  
[0-5]% 
[30-40]%  
[40-50]%  
[0-5]% 
[0-5]% 
[0-5]% 
[0-5]% 
[0-5]%  
[0-5]%  
[30-40]%  
[0-5]%  
[0-5]%  
[0-5]%  
[0-5]%  
[60-70]%  
[40-50]% [90-100]%           * 
[70-80]%             * 
[80-90]% 
[60-70]% 
[0-5]%                 *                   
[50-60]% 
[0-5]%  
[60-70]%             * 
[50-60]%             * 
[90-100]%           * 
[50-60]%             * 
[80-90]%             * 
[80-90]% 
[0-5]%                 *                   
[30-40]%             * 
[50-60]%             * 
[90-100]%           * 
[80-90]% 
[50-60]% [90-100]%           * 
[90-100]%           * 
[0-5]%  
[0-5]%  
[90-100]%           * 
[70-80]% 
[30-40]% 
[90-100]% 
[90-100]%           * 
[90-100]% 
[0-5]%  
[90-100]%           * 
[90-100]% 
[50-60]%             * 
[0-5]%  
[90-100]% 
[90-100]% 
[0-5]%  
[90-100]% [40-50]%  
[0-5]%   
[0-5]%                 * 
[0-5]%  
[30-40]%  
[40-50]%  
[0-5]% 
[0-5]% 
[0-5]%                 * 
[0-5]%  
[0-5]%   
[0-5]%  
[30-40]%  
[0-5]% 
[0-5]% 
[0-5]% 
[0-5]% 
[60-70]%  
[40-50]% below [20-30]%  
below [20 -30]% 
below [20 -30]%  
below [20 -30]% 
below [20 -30]%  
below [20-30]% 
below [20 -30]%  
below [20 -30]% 
below [20 -30]%  
below [20 -30]%  * 
below [20 -30]%  * 
below [20 -30]% 
below [20 -30]%  
below [20 -30]% 
below [20 -30]%  
below [20 -30]% 
below [20 -30]%  
below [20 -30]% 
below [20 -30]%  
Source: Notifying Party’s estimates  
(70) In addition, as regards a potential sub -segmentation of AAC large format 
prefabricated compound units between AAC large format prefabricated compound 
units for industrial construction and AAC large format prefabricated compound units 
for residential construct ion, the Notifying Party has provided the following separate 
market shares estimates for these potential downstream markets.  
                                                 
69 The Notifying Party did not p rovide  market shares at sub -national level for AAC products . However, for 
the purposes of this case, when assessing the potential for customer foreclosure risks arising as a result of 
the vertical link s between admixtures manufactured by EBA (upstream) and  the manufacture and sales of 
AAC products  (downstream), the Commission will analyse the downstream product market at national 
level. Even if the downstream products are considered at regional level and Xella constitutes the sole 
supplier in a particular r egion (which is already the case at national level in some countries, such as 
Slovenia for AAC large format prefabricated compound units ), for the same reasons as at national level, 
the Transaction would not appear likely raise serious doubts as to its com patibility as a result of this 
vertical link (see assessment  laid out in paragraph s (71) to (88)). 
70  The Notifying Party confirmed that Xella’s market share downstream for mo rtars would remain below 
[20-30]% under  any plausible product and geographic market definition.  
 
17 Table 3: overview of Xella's market shares downstream for AAC large format prefabricated 
compound  units for industrial construction and AAC large format prefabricated compound 
units for residential construction  (market shares provided are in volume,  m3, for 2019)  
Relevant 
geographic 
markets  Xella’s market 
shares 
downstream  for 
AAC large 
format 
prefabr icated 
compound units 
for industrial 
construction  Xella’s market 
shares 
downstream  for 
AAC large 
format 
prefabricated 
compound units 
for residential 
construction  
Austria  
Belgium  
Czech Republic  
Denmark  
Finland  
France  
Germany  
Hungary  
Netherlands  
Norway  
Poland  
Slovakia  
Slovenia  
Sweden  [90-100]%           * 
[90-100]%           *  
[90-100]%           *  
[70-80]% 
[30-40]% 
[90-100]% 
[90-100]%           *  
[90-100]% 
[90-100]%           *  
[90-100]% 
[50-60]%             * 
[90-100]% 
[90-100]% 
[90-100]% [90-100]%           *  
[90-100]%           *  
[90-100]%           *  
[70-80]% 
[30-40]%  
[90-100]% 
[90-100]%           *  
[90-100]% 
[90-100]%           *  
[90-100]% 
[90-100]%           *  
[90-100]% 
[90-100]% 
[80-90]% 
Source: Notifying Party’s estimates  
5.3.1.  Potential input foreclosure  
5.3.1.1.  The Notifying Party’s view  
(71) First, as regards ability, the Notifying Party argues that chemical -based admixtures  
are not an important input for the manufacture of AAC products, mineral insulation 
boards and mortars, and also, that admixtur es represent a negligible cost factor in the 
production of all these products. The Notifying Party explains (i) that the share of 
chemical -based admixtures  in Xella’s total per plant production costs where it 
produces the above -listed downstream products ranges between [0 -5]% and [0 -5]% 
only, depending on the factory, (ii) that as a share of Xella’s total production costs 
per country, it is only about [0 -5]% in Germany and around [0 -5]% in France, and 
sinks further to below [0 -5]% in terms of Xella’s overal l production costs in Europe, 
(iii) that since Xella’s competitors use similar production processes and 
technologies, it can be inferred that similar proportions would also apply to Xella’s 
competitors and (iv) that even considering producers of mortars th at are not Xella’s 
direct competitors,71 chemical -based admixtures  only account for well below [0-5]% 
of the production costs of the respective down -stream products (namely AAC 
blocks, AAC large format units, mineral insulation boards and mortars ).72 
(72) The Notifying Party also claims that the cost of switching between different 
chemical -based admixtures  suppliers is low, that there is a wide range of admixture 
                                                 
71  Xella does not produce and market mortar as a stand -alone product, but only as part of complete solutions 
involving its aerated concrete products. Moreover, these mortars are specially adapted to the needs of 
Xella’s AAC blocks, CSUs and mineral insulation boards, and sold at a higher price than the 
commoditi sed types of mortars, which account for t he majority of mortars sales. See form CO, paragraph 
74. 
72  Form CO, paragraphs 163 - 166 
 
18 producers besides BASF’s EB business across the EEA and that EBA products do 
not represent a si gnificant source of product differentiation for the downstream 
market of Xella’s products and their competing products since Xella’s and its 
competitors’ customers have no knowledge of, or interest in, the particular supplier 
that Xella relies on for chemi cal-based admixtures  used in its AAC blocks or other 
products .73 
(73) Finally, the Notifying Party explains that overall the risk of potential input 
foreclosure strategies would be low, given that BASF’s EB business is only an 
important supplier of chemical -based admixtures  to be used in AAC products for 
Xella. It explains that [70-80]% of BASF’s EB business’s sales of chemical -based 
admixtures  to customers active in the manufacture of AAC products in the EEA 
today are already made to Xella. Apart from Xella, BAS F’s EB business only 
supplies chemical -based concrete admixture s to only […] other purchasers in the 
AAC industry, with minimal purchases: [less than EUR 100,000 worth in each case].  
Thus, potential input foreclosure would be limited to those […] customers , which 
with the exception of the […] customer are not located in countries, where the 
merged entity would hold a strong market position upstream.74 
(74) Second, as regards incentive, the Notifying Party submits that any attempt to 
foreclose competitors of Xella would ultimately prove unprofitable, as Xella’s 
competitors can easily procure the chemical -based admixtures  they need from 
alternative sources, without an appreciable (if any) effect on the production costs. As 
such, the combined entity would incur a decrease of its  sales upstream without 
reaping any benefit from this strategy downstream.75 
(75) Third, as regards effects, the Notifying Party considers that given the lack of 
ability an d incentive, any effects of such a potential input foreclosure would be 
purely hypothetical, in particular because of the existence of other chemical -based 
admixtures  manufacturers across the EEA and Xella’s competitors ’ ability to switch 
their procurement s easily.76 
5.3.1.2.  The Commission’s assessment  
(76) First, as regards ability, the Commission notes that in several  of the vertically 
affected markets for chemical -based admixtures, input foreclosure appears rather 
unlikely based on the merged entity’s relatively modest market shares  at the 
upstream level , namely in Czech Republic: [30-40]%; Norway [30-40]%, and 
Sweden  [40-50]% (market shares by volume, 2019) . In other national markets, the 
merged entity would hold a more important position on the upstream market , namely  
in Austria ( [40-50]% ), Denmark ( [40-50]% ) and Spain ( [60-70]%) (market shares by 
volume, 2019) . 
(77) Howe ver, replies to the market investigation by chemical -based admixtures  
customers confirmed that post -transaction, there would remain a sufficient number 
of suppliers selling chemical -based admixtures  including in the latter categories of 
countries (Austria,  Denmark, and Spain) , if BASF’s EB business stopped selling 
                                                 
73  Additional submission by the Notifying Party dated 25.06.2020, paragraphs 9 and 10  
74  Form CO, paragraphs 180 – 182  
75  Additional submission by the Notifying Party dated 25.06.2020, paragraph 11  
76  Additional submission by t he Notifying Party dated 25.06.2020, paragraph 13  
 
19 chemical -based admixtures  to their company.77 This suggest s that in none of the 
relevant national markets  (Austria, Czechia, Denmark, Norway, Spain and Sweden) , 
the combined entity would not have t he ability to put in place an effective input 
foreclosure strategy, simply because foreclosed customers would be in a position to 
find readily available alternatives for their chemical -based admixtures  procurement 
on the market.  
(78) Second, as regards incenti ve, customers including those located in the six relevant 
countries  listed in Austria, Czechia, Denmark, Norway, Spain and Sweden  also 
confirmed that they did not expect  that the combined  entity would have an incentive 
to have BASF’s EB business stop selli ng chemical -based admixtures  to their 
company .78 
(79) Third, as regards effects, based on the elements provided by the Notifying Party, 
the Commission considers that chemical -based admixtures  do not appear to represent 
an important cost factor in the manufacture of any of the relevant downstream 
products (namely AAC products, mineral insulation boards and mortars). R eplies to 
the market investigation by customers for chemical -based admixtures  
overwhelmingly showed that chemical -based admixtures  represent less than 1% of 
their total production costs for the manufacture of AAC blocks, AAC large format 
prefabricated compound units, mineral insulation boards, CSU, aerated concrete 
roofing panels, fire  walls and outer walls  and less than 5% of the production costs of 
mortars .79 As a result, the Commission considers that a potential input foreclosure of 
chemical -based  admixtures  in Austria, Czechia, Denmark, Norway, Spain and 
Sweden  will likely not have any material impact, given that those admixtures only 
account for below 1% of the production costs of the respective down -stream 
products (namely AAC blocks, AAC large format units, mineral insulation boards 
and mortars ),80 and any deterioration of the term s or prices offered by BASF’s EB 
business would therefore have a minimal impact on the overall price of the final 
products.  This was also confirmed by the fact that the majority of respondents to the  
market investigation expected no impact as a result of t he Transaction.81 
                                                 
77  See replies to question 22 of  Q1 – Questionnaire to admixtures customers  as well as question 14 of Q4 – 
Questionnaire to admixture customers active in mortars and sealants . This was in particular the case from 
customers present in countries where BASF’s market shares in the sale of polymer -based concrete 
admixtures upstream is above 30%, namely Austria, Denmark and Spain, as well as Czech Republic, 
Norway and Sweden. Interes tingly, with respect to AAC large format units, the Commission received 
responses from admixtures customers active in the production of AAC large formats units in Austria, 
Belgium, Czech Republic, Hungary, Slovakia, Slovenia and Sweden, suggesting that Xel la’s market 
shares for AAC large format units in these countries might not be as high as [90 -100]%. The  Commission 
however did not receive any responses from AAC large format units manufacturers active in France, 
suggesting indeed that it might be possible  that Xella holds a [90 -100]% market  shares for AAC large 
format units in this country.  
78  See replies to question 2 3 of Q1 – Questionnaire to admixtures customers  as well as question 15 of Q4 – 
Questionnaire to admixture customers active in mortars and se alants . This was in particular the case from 
customers present in countries where BASF’s market shares in the sale of polymer -based concrete 
admixtures upstream is above 30%, namely Austria, Denmark and Spain, as well as Czech Republic, 
Norway and Sweden.  
79  See replies to question 3 of Q1 – Questionnaire to admixtures customers  as well as question 3 of Q4 – 
Questionnaire to admixture customers active in mortars and sealants . 
80  See also paragraph (71) above  
81  See replies to question 2 4 of Q1 – Questionnaire to admixtures customers  as well as question 16 of Q4 – 
Questionnaire to admixture customers active in mortars and sealants . 
 
20 5.3.2.  Potential customer foreclosure  
5.3.2.1.  The Notifying Party’s view  
(80) First, as regards ability, the Notifying Party argues that Xella is not an important 
customer for chemical -based admixtures  in the EEA , since Xella (overall) represents 
[0-5]% of all purchases of chemical -based concrete admixture (from BASF’s EB 
business and its competitors) in Germany, [0-5]% in France, and well below [0 -5]% 
in all other countries where it is active. As such, if the combined entity were to put in 
place a custo mer foreclosure strategy, BASF EB business’ competitors in the 
manufacture of chemical -based admixtures would still have a sufficiently large pool 
of customers to sell to.82 
(81) Second, as regards incentive, the Notifying Party argues83 that since  competitors  
of BASF’s EB business also  have very low sales to Xella , a decision by Xella post -
Transaction to divert its relevant chemical -based admixtures  orders to the Target 
would not reduce the ability and incentive of the Target’s competitors to compete 
and therefore that Xella could  not affect the Target’s upstream competitors by 
increasing their cost to access downstream customers or by restricting th eir access to 
a significant customer base.  
(82) Third, as regards effects, the Notifying Party explains that given the very limited 
importance of Xella’s purchases , the volume of lost sales for the Target’s 
competitors in case of a potential customer foreclosu re attempt would be de minimis  
and would not give rise to price increases in the upstream market.84 
5.3.2.2.  The Commission’s assessment  
(83) First, as regards ability, the Commission notes that Xella has very high market 
shares (above 40%) at national level downstream i n some countries, in particular, 
with respect to (i) AAC blocks in Austria, Belgium, Bulgaria, Croatia, Denmark, 
France, Germany, Hungary, Italy, the Netherlands, Norway, Slovakia, Slovenia, 
Spain and Sweden; (ii) AAC large prefabricated compound units in Austria, 
Belgium, Czech Republic, Denmark, France, Germany, Hungary, Netherlands, 
Norway, Poland, Slovakia, Slovenia and Sweden; and (iii) mineral insulation boards 
in Austria, Czech Republic, Denmark, Norway, Spain and Sweden  (see Table 2 
above) . Despite th ese high market shares , it would appear unlikely that the merged 
entity would have the ability to engage in customer foreclosure to the detriment of 
other suppliers of chemical -based admixtures . 
(84) Preliminarily, it should be noted that  Xella only has manufacturing facilities in a 
subset of the countries where it sells construction material , namely in Austria, 
Belgium, Bulgaria, Czechia, France, Germany, Hungary, Italy, the Netherlands, 
Poland, Romania, Slovakia and Slovenia .85 In light of this and taking into account 
                                                 
82  Form CO, paragraph 185  
83  Additional submission by the Notifying Party dated 25.06.2020, paragraph 1 6 
84  Additional submission by the Notifying Party dated 25.06.2020, paragraph 17  
85  More precisely, for (i) AAC blocks in Austria, Belgium, Czechia (not affected downstream), France,  
Germany, Hungary, Italy, Netherlands, Poland (not affected downstream), Romania, Slovakia and 
Slovenia;  (ii) AAC large format units in Austria, Belgium, Czechia, Germany, Netherlands and Poland;  
(iii) for mineral insulation boards in Bulgaria and German y (both countries not affected downstream ); and 
(iv) for mortars in Italy and the Netherlands (both countries not affected downstr eam).  
 
21 the national scope of the market for chemical -based admixtures, a potential customer 
foreclosure scenario resulting from Xella’s high market shares downstream at 
national level would be more likely to take place in countries  with manufacturing 
facilities , rather than in those countries where it has no manufacturing facilities  (in 
other words, if the potential customer foreclosure issue is consi dered at national 
level, thus in any country where Xella has no plant, there is as such no customer to 
foreclose) . In particular, for mineral insulation boards, if the potential customer 
foreclosure issue is considered at national level,  no customer forecl osure scenario 
would be possible with respect to chemical -based admixtures , since Xella does not 
purchase chemical -based admixtures in any of the 6 countries where it has a high 
market share (>30%) downstream86. 
(85) In addition, the market investigation confirm ed that chemical -based admixtures  are 
used in a multitude of applications, such as the production of regular concrete above 
everything else,87 and that the types of products manufactured by Xella only 
represent a small share in those applications. As such, Xella therefore does not 
appear to be an important purchaser of chemical -based admixtures . The market 
investigation also revealed that BASF EB Business’ competitors in the manufacture 
of chemical -based admixtures  would still have a sufficiently large pool of customers 
to sell to  if Xella stopped purchasing polymer -based concrete admixtures from their 
company , where Xella has a high market share (>30%) downstream, that is for (i) 
AAC blocks  in Austria, Belgium, Bulgaria, Croatia, Denmark, France, Germany, 
Hungary, Italy, the Netherlands, Norway, Romania, Slovakia, Slovenia, Spain and 
Sweden; (ii) AAC large format units  in Austria, Belgium, Czechia, Denmark, 
Finland, France Germany, Hungary, the Netherlands, Norway, Poland, Slovakia, 
Slovenia and Sweden and (iii) for mineral insulation boards in Austria, Czechia, 
Denmark, Norway, Spain and Sweden.  88 
(86) Second, as regards incentive, chemical -based admixtures  manufacturers 
responding to the market investigation consider that post-Transaction, Xella would 
not have any incentive to stop purchasing polymer -based concrete admixtures from 
their company , where Xella has a high market share (>30%) downstream, that is  for 
(i) AAC blocks in Austria, Belgium,  Bulgaria, Croatia, Denmark, France, Germany, 
Hungary, Italy, the Netherlands, Norway, Romania, Slovakia, Slovenia, Spain and 
Sweden; (ii) AAC large format units in Austria, Belgium, Czechia, Denmark, 
Finland, France Germany, Hungary, the Netherlands, Norw ay, Poland, Slovakia, 
Slovenia and Sweden and (iii) for mineral insulation boards in Austria, Czechia, 
Denmark, Norway, Spain and Sweden .89 
                                                 
86  Austria, Czechia, Denmark, Norway, Spain and Sweden.  
87  See replies to question 2.1 of Q2 – Questionnaire to admixtur es competitors . Admixtures manufacturers in 
particular that confirm that the vast majority of admixtures sales are made to ready  mix concrete plants as 
well as final customers producing plain concrete and plain concrete elements.  
88  See replies to question  9 of Q2 – Questionnaire to admixtures competitors  “There is a sufficient number of 
potential customers in precast and ready mix industries in the market for all producers of admixtures ”, 
“Xella and Stark produce very special types of materials, which have  limited use/application in the 
building industry ”, “There will be sufficient customers ” .     
89  See replies to question 10 of Q2 – Questionnaire to admixtures competitors  “No customer has long term 
interest in keeping itself out of this highly evolving and technical market of the  admixtures. Concentrating 
its purchases on one supplier for othe reasons than the best cost/efficiency ration  would jeopardize any 
commercial effort to stay competitive in its final market ” 
 
22 (87) Third, as regards effects, the market investigation showed that chemical -based 
admixtures  manufacturers consider that  the Transaction would have no impact on the  
market for polymer -based concrete admixtures , where Xella has a high market share 
(>30%) downstream, that is for (i) AAC blocks in Austria, Belgium, Bulgaria, 
Croatia, Denmark, France, Germany, Hungary, Italy, t he Netherlands, Norway, 
Romania, Slovakia, Slovenia, Spain and Sweden; (ii) AAC large format units in 
Austria, Belgium, Czechia, Denmark, Finland, France Germany, Hungary, the 
Netherlands, Norway, Poland, Slovakia, Slovenia and Sweden and (iii) for mineral  
insulation boards in .90 
(88) In light of the above, the Commission considers that the Transaction does not  give 
rise to serious doubts as to its compatibility with the internal market in relation to the 
vertical link arising between  chemical -based admixtures , in Austria, Czechia, 
Denmark, Norway, Spain and Sweden  (upstream) and the manufacture and sales of 
various building and insulation materials , that is for (i) AAC blocks in Austria, 
Belgium, Bulgaria, Croatia, Denmark, France, Germany, Hungary, Italy, the 
Netherlands, Norway, Romania, Slovakia, Slovenia, Spain and Sweden; (ii) AAC 
large format units in Austria, Belgium, Czechia, Denmark, Finland, France 
Germany, Hungary, the Netherlands, Norway, Poland, Slovakia, Slovenia and 
Sweden and (iii) for mineral ins ulation boards in Austria, Czechia, Denmark, 
Norway, Spain and Sweden  (downstream).  
5.4. Vertical relationships between chemical -based admixtures  (upstream) and the 
retail sales of building materials to professional and non -professional customers 
(downstream)  
(89)  BASF’s EB business, through its EBA business, manufactures chemical -based 
admixtures . Some of these products (as well as the ones manufactured by BASF’s 
EB business’ upstream competitors) are purchased and then resold by Stark to 
professional and retail c ustomers.  
(90) This vertical link gives rise to markets that are affected upstream at national level in 
three EEA countries (Denmark, Norway and Sweden) because BASF’s EB business’ 
market share in the sale of chemical -based admixtures   is above 30% in these 
countries. It also gives rise to markets that are affected downstream at regional level 
in Denmark in the regions of Denmark capital and Central Jutland (where Stark has a 
[30-40]% market share  in volume ), in Norway in the regions Troms og Finnmark 
([30-40]% ) and Sogn og Fjordane ( [50-60]%), and probably also in some regions of 
Finland (where Stark holds a [20-30]% market share at national level for the sales to 
professional customers, but was not able to provide a regional breakdown of its 
market share at sub-national level). The Notifying Party did not  submit separate 
market share data for professional customers and non -professional customers at 
regional level.91 Table 4 below provides an overview of these vertical relationships.  
                                                 
90  See replies to question 11 of  Q2 – Questionnaire to admixtures competitors . 
91  The Notifying Part y provided separate data for professional and non -professional customers for Stark at 
national level, as well as some rough estimates of Stark’s market shares in the sale of EBA and EBC 
products  to professional, as well as non -professional customer, at regional level, in these five countries. 
However, these appear less informative than the ones provided in Table 4 since they are provided in the 
form of ranges ( e.g. <30%) with upper bounds that are very similar to Stark’s overall market shares at 
regional level. Moreover, for the same reasons as mentioned above in Footnote 69, given the national 
 
 
23 Table 4: overview of the vertical relationships between chemical -based admixtures  
manufactured by EBA (upstream) and the sales of building materials to professional and 
retail customers (downstream).  (market shares provided are in value, EUR , for 2019)  
Relevant 
geographic 
markets  BASF’s EB 
business’s 
market 
share 
upstream 
in the sales 
of 
chemical -
based 
admixtures  Stark’s market shares downstream for the 
sales of building materials to professional 
customers  Stark’s market shares downstream  for the 
sales of building materials to non -
professional customers  
Denmark  
 
 
 
Finland  
 
 
 
Norway  
 
 
 
Sweden  [40-50]%  
 
 
 
[20-30]%  
 
 
 
[30-40]%  
 
 
 
[40-50]% [20-30]% - ([20-30]%  for Denmark all 
customers / [30-40]% for Denmark capital - 
all customers / [30-40]% for Central Jutland 
– all customers)  
 
[20-30]%  Finland ( [10-20]% all customers - 
No regional breakdown for Finland.)  
 
 
[5-10]%  ([5-10]% for Norway overall / [30-
40]% for Norway Troms og Finnmark - all 
customers : [50-60]% for Sogn og Fjordane -  
all customers)  
 
[10-20]%  ([5-10]% all customers)  [10-20]% - ([20-30]%  for Denmark all 
customers / [30-40]% for Denmark capital - 
all customers / [30-40]% for Central Jutland – 
all customers)  
 
[5-10]%  Finland ( [10-20]%  all customers - 
No regional breakdown for Finland.)  
 
 
[0-5]% ([0-5]% for Norway overall - [30-
40]% for Norway Troms og Finnmark - all 
customers : [50-60]% for Sogn og Fjordane -  
all customers)  
 
[5-10]%  ([5-10]%  all customers)  
Source: Notifying Party’s estimates  
5.4.1.  Potential input foreclosure  
5.4.1.1.  The Notifying Party’s view  
(91) First, as regards ability, the Notifying Party submits that Stark does not actively 
engage in the sale of chemical -based admixture s, and that these products are not 
generally sold through distributors of building materials. The Notifying Party further 
claims that Stark is not aware of sales of chemical -based admixtures  by its 
competitors.92 As such, it would therefore appear that admixtures are not an 
important input for the distribution of building materials.  
(92) Second, as regards incentive, the Notifying Party , again93 argues94 that since  
competitors of BASF’s EB business also  have very low sales to Xella, a decision by 
Xella post -Transaction to divert its relevant chemical -based admixtures   orders to the 
Target would not reduce the ability and incentive of the Target’s competitors to 
compete and therefore that Xella could not affect the Targ et’s upstream competitors 
by increasing their cost to access downstream customers or by restricting their access 
to a significant customer base.  
                                                                                                                                                      
nature of the market for admixtures, it appears relevant to  the purposes of this case that  the Commission 
carries its assessment of the downstream product market at national level when considering  the potential 
for customer foreclosure risks arising as a result of the vertical link s between admixtures manufactured by 
EBA (upstream) and the distribution of building materials (downstream).  
92  Form CO, paragraph 110  
93  See paragraph (81)  
94  Additional submission by the Notifying Party dated 25.06.2020, paragraph 1 6 
 
24 (93) Third, as regards effects, the Notifying Party argues that such foreclosure strategy 
would likely lack of impa ct, given that chemical -based admixtures  typically 
represent [0-5]% of the sales made by Stark as a distributor and [0-5]% of its 
procurements , and the Notifying Party submits that it can be inferred that the same 
ratio would apply to Stark’s competitors i n the distribution of construction 
materials.95 Therefore, any attempt by the combined entity to cease supplying 
chemical -based admixtures  to Stark’s downstream competitor, or degrade the terms 
or conditions of supply is not likely to have any meaningful im pact on Stark’s 
competitors’ profitability on the downstream market.96 
5.4.1.2.  The Commission’s assessment  
(94) First, as regards ability, the Commission observes that BASF EB business’ market 
shares upstream suggests that in all three countries  (Denmark, Sweden and Norway) , 
there are alternative suppliers of chemical -based admixtures , which jointly make up 
for a large share in the supply in all three countries  ([50-60]% in Denmark; [60-70]% 
in Sweden and [60-70]%  in Norway) . 
(95) Moreover, replies to  the market investigation by chemical -based admixtures  
customers confirmed that post -transaction, admixture customers present in all three 
countries (Denmark, Sweden and Norway) and active in both the retail distribution 
of building materials to DIY custom ers and to professional customers consider that 
there would remain a sufficient number of suppliers selling chemical -based 
admixtures , if BASF’s EB business stopped selling chemical -based admixtures  to 
their company.97 This would suggest that the combined e ntity would not have the 
ability to put in place an effective input foreclosure strategy, simply because  
foreclosed customers would be in a position to find readily available alternatives for 
their chemical -based admixtures  procurement on the market.  
(96) Secon d, as regards incentive, the Commission notes that it is questionable whether 
the merged entity’s downstream market position would allow it to recover customers 
for chemical -based admixtures  through the Stark distribution outlets, given that the 
market pos ition at the downstream level is only strong in very limited regions. 
Therefore, it is questionable that the merged entity would have an incentive in 
engaging in input foreclosure.  
(97) The Commission’s market investigation confirmed that chemical -based admixtures  
customers present in all three countries (Denmark, Sweden and Norway) and active 
in both the retail distribution of building materials to DIY customers and to 
professional customers did not expect the combined entity to have an incentive to 
have  BASF’s EB business stop selling chemical -based admixtures  to their 
company.98 
(98) Third, as regards effects, based on information provided by the Notifying Party, 
the Commission observes that such foreclosure strategy would likely lack of impact, 
given that chemical -based admixtures  typically represent [0-5]% of the sales made 
by Stark as a distributor, and the Notifying Party submits that it can be inferred that 
                                                 
95  Form CO, paragraphs  196 – 197  
96  Form CO, paragraphs 196 – 198  
97  See replies to question 22 of  Q1 – Questionnaire to admixtures customers . 
98  See replies to question 2 3 of Q1 – Questionnaire to admixtures customers . 
 
25 the same ratio would apply to Stark’s competitors in the distribution of construction 
materials. Th erefore, any attempt by the combined entity to cease supplying 
chemical -based admixtures   to Stark’s downstream competitor, or degrade the terms 
or conditions of supply is not likely to have any meaningful impact on Stark’s 
competitors’ profitability on th e downstream market.  
(99) This was confirmed in the course of the  Commission’s market investigation , which 
unambiguously showed that chemical -based admixtures  represent less than 1% of 
distributors of building materials’ sales, both to professional customers and to DIY 
customers .99 As a result, the Commission considers that a potential input foreclosure 
of chemical -based admixtures  will likely not have any material impact, since  any 
deterioration of the terms or prices offered by BASF’s EB business would have a  
minimal impact on the amount of sales made by distributors of building materials . 
The market investigation also revealed that the majority of customers  expected no 
impact as a result of the Transaction.100 
5.4.2.  Potential customer foreclosure  
5.4.2.1.  The Notifying Party’s view  
(100)  First, as regards ability, the Notifying Party submits that Stark’s purchases 
represents well below 30% of the total sales of chemical -based admixtures  in the 
countries where it is active, and that Stark can therefore not be considered as an 
important customer for admixture manufacturers.101 
(101)  Second, as regards incentive, the Notifying Party claims  that excluding the 
chemical -based admixtures  products of the Target’s competitors from Stark’s outlets 
would generate hardly any additional EBA sales t hrough Stark, as the distribution of 
EBA products does not generally take place through such outlets.102 
(102)  Third, as regards effects, the Notifying Party explains that given the very small 
amount of chemical -based admixtures  purchased  by Stark, foreclosing acc ess to 
Stark as a purchaser of chemical -based admixtures  would not have any effects on the 
upstream competitors of BASF’s EB business, nor would it have any meaningful 
impact on the competitive dynamics of the market in general.  
5.4.2.2.  The Commission’s assessment  
(103)  First, as regards ability, the Commission observes that given the national nature of 
the market for chemical -based admixtures , any upstream competitor of BASF’s EB 
business in the market for admixtures would be likely to be rather indifferent to 
whether S tark is stronger in the distribution of building products to professional or 
retail customers at sub -national level in some regions than others, because their main 
interest would be whether Stark is an important buyer of admixtures at national level 
overal l. Consequently , Stark’s market share in the distribution of building products 
to professional or retail customers at national level,  is a sufficient proxy in order to 
carry out  the assessment of these vertical relationships. These market shares at 
                                                 
99  See replies to question 4 of Q1 – Questionnaire to admixtures customers . 
100  See replies to question 2 4 of Q1 – Questionnaire to admixtures customers . 
101  Form CO, Annex 12  
102  Additional submission by the Notifying Party dated 25.06.2020, paragraph 26  
 
26 national level are below the 30% threshold for a market to be considered as 
vertically affected for every country where Stark is present , it would appear that any 
customer foreclosure scenario is very unlikely, for lack of ability.  
(104)  Moreover, the Commission’s market investigation confirmed that that BASF EB 
Business’ competitors in the manufacture of chemical -based admixtures  would still 
have a sufficiently large pool of customers to sel l to if Stark stopped purchasing 
polymer -based concrete admixtures from their company , where Stark has a high 
market share (>30%) downstream , that is in Denmark, Norway and Sweden .103 
(105)  Second, as regards incentive, the Commission’s market investigation reveal ed that 
chemical -based admixtures  manufacturers consider that post -Transaction, Stark 
would not have any incentive to stop purchasing polymer -based concrete admixtures 
from their company.104 
(106)  Third, as regards effects, based on information submitted by the No tifying Party, 
the Commission observes that such foreclosure strategy would likely lack of impact, 
given that Stark’s purchases of chemical -based admixtures  are below 30% of the 
total sales of admixtures in the countries where it is active.  Moreover, the m arket 
investigation confirmed that chemical -based admixtures’  manufacturers consider that 
the Transaction would have no impact on the market for polymer -based concrete 
admixtures.105 
(107)  In light of the above, the Commission considers that the Transaction does not give 
rise to serious doubts as to its compatibility with the internal market in relation to the 
vertical link arising between  chemical -based admixtures  (upstream) and the 
distribution of building materials  (downstream)  to i) wholesale sales to retaile rs; (ii) 
retail sales to professional customers (B2B); and (iii) retail sales to non -professional 
customers (primarily through DIY stores)  in Denmark, Norway and Sweden .  
5.5. Vertical relationships between mortars and several other specialty construction 
produ cts (upstream) and the retail sales of building materials to professional 
and non -professional customers (downstream)  
(108)  BASF’s EB business, through its EBC business, manufactures a variety of products 
such as mortars, concrete repair and protection systems, performance grouts, 
waterproofing systems, sealants, performance flooring systems, wall systems and 
coatings for mulch and wood fibres. It is however noted that mortars are the most 
important amongst them. Some of these products (as well as the ones manufa ctures 
by BASF’s EB business upstream competitors) are purchased and  resold by Stark to 
professional and retail customers.  
(109)  BASF’s EB business’  market share do not give rise  to affected markets upstream106. 
Given the Parties’ (through BASF’s EB business) sma ll market shares in the 
upstream markets, and consequently the combined entity’s inability to foreclose 
access to the relevant products post -Transaction, input foreclosure will not be 
assessed in this decision.  
                                                 
103  See replies to question 9 of Q2 – Questionnaire to adm ixtures competitors   
104  See replies to question 10 of Q2 – Questionnaire to admixtures competitors   
105  See replies to question 11 of  Q2 – Questionnaire to admixtures competitors . 
106 On the basis of data provided by the Notifying Party.  
 
27 (110)  This vertical link gives rise to markets that  are affected downstream at regional level 
in Denmark in the regions of Denmark capital and Central Jutland (where Stark 
holds a [30-40]% market share), in Norway in the regions Troms og Finnmark ( [30-
40]% ) and Sogn og Fjordane ( [50-60]%), and probably als o in some regions of 
Finland (where Stark holds a [20-30]% market share at national level for the sales to 
professional customers, but was not able to provide a regional breakdown of its 
market share). The Notifying Party did not  submit separate market sha re data for 
professional customers and non -professio nal customers at regional level (see 
Footnote 91 above). Table 5 below provides an overview of these vertical 
relationships.  
Table 5: overview of the vertical relationships between mortars and other products 
manufactured by EBC (upstream) and the sales of building materials to professional and 
retail customers (downstream).  (market shares provided are in v alue, EUR , for 2019)  
Relevant 
geographic 
markets  BASF’s EB 
business’s 
market 
share 
upstream 
for 
mortars, 
sealants, 
grouts and 
other 
constructio
n chemicals  
manufactur
ed by EBC  Stark’s market shares downstream for the 
sales of building materials to professional 
customers  Stark’s market shares downstream  for the 
sales of building materials to non -
professional customers  
Denmark  
 
 
 
Finland  
 
 
Norway  
 
 <20% for all 
products 
under any 
plausible 
product or 
geographic 
market 
definition  [20-30]% - ([20-30]%  for Denmark all 
customers / [30-40]% for Denmark capital - 
all customers / [30-40]%  for Central Jutland 
– all customers)  
 
[20-30]%  Finland ( [10-20]% all customers - 
No regional breakdown for Finland.)  
 
[5-10]% ([0-5]% for Norway overall / [30-
40]% for Nor way Troms og Finnmark - all 
customers : [50-60]% for Sogn og Fjordane -  
all customers)  [10-20]% - ([20-30]%  for Denmark all 
customers / [30-40]% for Denmark capital - 
all customers / [30-40]% for Central Jutland – 
all customers)  
 
[5-10]% Finland ( [10-20]% all customers - 
No regional breakdown for Finland.)  
 
[0-5]% ([0-5]% for Norway overall - [30-
40]% for Norway Troms og Finnmark - all 
customers : [50-60]% for Sogn og Fjordane -  
all customers)  
Source: Notifying Party’s estimates  
5.5.1.  Potential customer forecl osure  
5.5.1.1.  The Notifying Party’s view  
(111)  First, as regards ability, the Notifying Party claims that in light of the national 
nature of the upstream markets for mortars, sealants, grouts and other products 
manufactured by EBC  (“EBC products”) , it would be not be appropriate to consider 
Stark’s market shares at a sub -national level. Given that Stark’s mark et share in 
every country where it is active remains below 30%, the Notifying Party submits that 
the combined entity would lack the ability to foreclose access to  an important 
customer downstream.107 In addition, the Notifying Party explains that Stark is not 
an important customer for products manufactured by EBC, which is evidenced by 
the fact that (i) Stark’s purchase shares for all EBC products in all countries wh ere it 
                                                 
107  Additional submission by the Notifying Party dated 25.06.2020, paragraph 30  
 
28 is active is below 30%,108 and (ii)  [80-90]% of the total sales made by EBC in 
Denmark and [60-70]% in Norway were direct sales to customers (without the 
intermediary of a distributor).109 The Notifying Party further submits that BASF’s 
EB business’ competitors for EBC products follow similar commercial policies to 
those of BASF’s EB business and are comparably reliant on direct sales  as opposed 
to sales to distributors .110 Therefore, Stark w ould not appear to be an important 
customer for EBC products.  
(112)  Second, as regards incentive, the Notifying Party submits that given the modest 
volumes of EBC products sold by Stark, any attempt by the combined entity to 
exclude sales by BASF EB business’ co mpetitors would not generate an increase of 
sales in EBC products manufactured by BASF’s EB business that would be 
sufficient to outweigh the loss of sales of similar products manufactured by BASF’s 
EB business’ competitors. On the contrary, it would deter iorate Stark’s relationships 
with BASF’s EB business’ competitors, from whom Stark purchases a variety of 
products besides EBC products, which would in turn negatively affect the terms and 
conditions (e.g., discounts) offered by such suppliers to Stark for  their whole range 
of products.111 
(113)  Third, as regards effects, the Notifying Party explains that given the modest 
volumes of EBC products sold by Stark  and Stark’s modest purchase shares of EBC 
products in all countries where it is active , it cannot be consid ered that a sufficiently 
large fraction of upstream output is affected by the revenue decreases resulting from 
the Transaction, so that any attempt by the combined entity to put in place a 
customer foreclosure strategy would have no impact on the upstream market.112 
5.5.1.2.  The Commission’s assessment  
(114)  First, as regards ability, the Commission agrees  that given the national nature of 
the upstream markets for mortars, sealants, grouts and other products manufactured 
by EBC, any upstream competitor of BASF’s EB business  in the market for 
admixtures would be likely to be rather indifferent to whether Stark is stronger in the 
distribution of building products to professional or retail customers at sub -national 
level in some regions than others, because their main interest would be whether 
Stark is an important buyer of admixtures at national level overall. As a proxy for 
this in the first place, Stark’s market share in the distribution of building products to 
professional or retail customers at national level,  appear to be sufficient for the 
purposes of the assessment of these vertical relationships. These market shares at 
national level being below the 30% threshold for a market to be considered as 
vertically affected for every country where Stark is present;  it would appea r that any 
customer foreclosure scenario is very unlikely, for lack of ability.  
(115)  Moreover, the Commission’s market investigation confirmed that BASF EB 
Business’ competitors in the manufacture of mortars, sealants and other EBC 
products would still have a s ufficiently large pool of customers to sell  all of their 
                                                 
108  See Annex 12 of Form CO  
109  Additional submission by the Notifying Party dated 25.06.2020, paragraph 33. See also Annex 10 of the 
Form CO  
110  Additional submission by the Notifying Party dat ed 25.06.2020, paragraph 34  
111  Additional submission by the Notifying Party dated 25.06.2020, paragraphs 38 – 39  
112  Additional submission by the Notifying Party dated 25.06.2020, paragraph 40  
 
29 products  to if Stark stopped purchasing mortars, sealants and other EBC products 
from their company .113 
(116)  Second, as regards incentive, the Commission’s market investigation confirmed  
that BASF EB Business’ competitors in the manufacture of mortars, sealants and 
other EBC products  consider that post -Transaction, Stark would not have any 
incentive to stop purchasing mortars, sealants and other EBC products from their 
company.114 
(117)  Third, as regards effec ts, the Commission’s market investigation confirmed that 
BASF EB Business’ competitors in the manufacture of mortars, sealants and other 
EBC products consider that the Transaction would have no impact on the market for 
mortars, sealants and other EBC produ cts.115 
(118)  In light of the above, the Commission considers that the Transaction does not  give 
rise to serious doubts as to its compatibility with the internal market in relation to the 
vertical link arising between  mortars and several other specialty constructi on 
products (upstream) and the distribution of building materials  (downstream) toi) 
wholesale sales to retailers; (ii) retail sales to professional customers (B2B); and (iii) 
retail sales to non -professional customers (primarily through DIY stores)  , Denma rk, 
Norway and Sweden .  
6. CONCLUSION  
(119)  For the above reasons, the European Commission has decided not to oppose the 
notified operation and to declare it compatible with the internal market and with the 
EEA Agreement. This decision is adopted in application of Article 6(1)(b) of the 
Merger Regulation and Article 57 of the EEA Agreement.   
For the Commission  
 
 
(Signed)  
Margrethe VESTAGER  
Executive Vice-President  
 
 
 
                                                 
113  See replies to question 11 of Q3 – Questionnaire to mortars and sealants  competitors   
114  See replies to question 12 of Q3 – Questionnaire to mortars and sealants  competitors   
115  See replies to question 13 of Q3 – Questionnaire to mortars and sealants  competitors