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, 2.7.2019  
C(2019 ) 5153 final  
PUBLIC VERSION  
 
To the notifying p arty 
Subject : Case M.9353 – ADVENT INTERNATIONAL CORPORATION / 
EVONIK METHACRYLATES BUSINESS DIVISION  
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 23 May 2019 , the European Commission received notification of a proposed 
concentration pursuant to Article 4 of the Merger Regulation by which Advent 
International Corporation (“Advent” or “Notifying Party”) intends to acquire sole 
control over the methacrylates busin ess division of Evonik Industries AG (“Evonik 
Methacrylates” or the “Target”) .3 Advent and the Target are collectively referred to as 
the “Parties”.  
1. THE PARTIES  
(2) Advent is a private equity investor based in the United States. Advent controls a 
portfolio com pany, Allnex, active worldwide in the production of resins  for coating s 
                                                 
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 Journal of the European Union No C 186, 3.6.2019 , p. 20.  
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information omitted has been replaced by 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 (“coating resins”) . Coating resins are in turn used in a variety of products, including 
coatings and paints, where these resins determine the performance characteristics of 
these produ cts (including, e.g. durability, flexibility and resistance).4 
(3) The Target is a business division of Evonik Industries AG (“Evonik”, Germany) 
with assets in Germany, the United States, and China. It is active worldwide in the 
manufacture and supply  of methy l methacrylate (“MMA”) and other methacrylate 
monomers derived from MMA (“MMA derivatives”), which are chemicals used for 
a variety of applications, including plastics, acrylics, adhesives, varnishes, polishes, 
textile binders, coatings and resins. The Tar get manufactures and supplies certain 
types of methacrylate resins, some of which are also produced by Allnex. Finally, 
the Target is active in the manufacture and supply of  polymethyl methacrylate 
(“PMMA” , manufactured using MMA ) molding compounds and acr ylic products, 
and cyanides.  
2. THE OPERATION  AND CONCENTRATION  
(4) Pursuant to a master sale and purchase agreement entered into on 4 March 2019 
between an acquisition vehicle ultimately owned by funds advised by Advent (as 
buyer) and Evonik (as seller), Advent will acquire 100% of – and sole control over – 
the assets and  shares constituting the Target (the “Transaction”).  
(5) Therefore, the Transaction constitutes a concentration within the meaning of Article 
3(1)(b) of the Merger Regulation.  
3. EU DIMENSION  
(6) The undertakings concerned have a combined aggregate world -wide turnove r of 
more than EUR 5 000 million5 ([Advent’s worldwide turnover ], [Target: approx. 
EUR 2 billion ]). Each of them has a n EU-wide turnover in excess of EUR 250 
million  ([Advent’s EU -wide turnover ], [Target’s EU -wide turnover ]), but they do 
not achieve more t han two -thirds of their aggregate EU-wide turnover within one 
and the same Member State. The notified operation therefore has an EU dimension.  
4. RELEVANT MARKETS  
4.1. Activities of the Parties  
(1) Advent’s portfolio company Allnex  
(7) In 2013, Advent acquired the coatin g resins business of Cytec Industries Inc, which 
was renamed Allnex (and which Advent currently controls). In 2016, Advent 
acquired Nuplex Industries, which it subsequently merged with Allnex.6 As a result, 
                                                 
4   Form CO, paragraph 93. See also paragraphs (8)-(9) below.  
5  Turnover cal culated in accordance with Article 5 of the Merger Regulation .  
6  The acquisition of Nuplex Industries by Advent was reviewed and authorised by the European 
Commission in Case M.8019 – Advent International/Nuplex Industries . 
3 Allnex is currently active in the manufacture of coating resins, some of which use 
MMA and MMA derivatives as inputs.7 
(8) Coatings are chemical formulations that can be applied in a thin layer (or film) onto 
a particular substrate (e.g. metal, wood) to provide decorative, protective or other 
functional effe cts on a surface.8 Resins are intermediate ingredients that act as 
binders in the production of coatings, paints and inks. Resins bind the various 
components of a coating or paint together into a film, and bond the film to the 
substrate. The film protects the substrate and improves its decorative appeal.9  
(9) Resins are essential elements of the coatings formulation as resins determine the 
performance characteristics of the coatings, such as gloss, durability, smoothness, 
flexibility, weatherability and resist ance.10 Common chemistries of coating resins 
based on the base chemical component of the resin include acrylics, alkyds, epoxies. 
Coating resins of some chemistries  may be used in more than one type of delivery 
technology for end products, e.g. liquid or po wder. The most common delivery 
technologies for coating resins include water -borne (commonly used in coatings and 
paints), solvent -borne (also commonly used in paints and allows for higher metal 
adhesion and corrosion resistance), powder -based (particularl y suitable for metal 
coatings and other applications where durability and performance are important) and 
radiation -curable (especially suited for use in graphic arts and coatings or industrial 
applications).11 
(10) Allnex is active in the EU, the USA, China and Australia, where it also has 
manufacturing facilities.12 
(2) The Target  
(11) The Target manufactures MMA , a colourless organic compound used in the 
manufacture of PMMA molding compounds, acrylic products, impact modifiers, 
acrylic latexes, lacquers, enamels, and res ins for use in specialty chemicals and 
coatings.13 Other important applications for MMA include emulsion polymers 
principally for paper, textiles, leather and floor polishes, mineral -filled sheet, 
polyesters, polymer concrete, and adhesives.14 The Target sel ls part of its MMA 
production on the merchant market and uses part for the captive manufacture of 
PMMA molding compounds and acrylic products .15 
                                                 
7  Form CO, paragraphs 41, 43,  52; Case M.6778 – Advent International Corporation/Cytec’s Resin 
Business ; Case M.8019 – Advent International/Nuplex Industries . 
8  Form CO, paragraph 91.  
9  Form CO, paragraph 92.  
10  Form CO, paragraph 93.  
11  Form CO, paragraph 94; Commission decision in  Case M.9019 – Advent International/Nuplex 
Industries , paragraph 30; Form CO, paragraph 9 and footnote 62.  
12  Form CO, paragraph 52.  
13  Form CO, paragraph 2.  
14  IHS Chemical “Methyl Methacrylate Chemical Economics Handbook” (15 August 2016), provided as 
Annex 8 to the Form CO, p.5.  
15  Form CO, paragraph 2.  
4 (12) The Target also manufactures MMA derivatives that are used downstream in inter 
alia  surface coatings either as inputs for coating resins or as direct inputs in coating 
formulations,16 namely: 
a. Glacial methacrylic acid (“ GMAA ”), whose crude form is methacrylic acid 
(“MAA”), a clear, colourless liquid, completely soluble in water and soluble in 
most organic solvents. MAA exhibits specific properties, such as good 
chemical resistance, improved freeze-thaw resistance, enhanced surface 
adhesion, toughness, and colloidal stability in emulsions.17 In addition to its 
use in coating resins, MAA is used in a variety of applications, including in the 
production of other methacrylates (by direct esterification), in construction 
chemicals, adhesives and sealants, paints and coatings, emulsion polymers, 
composites, paper and textile applications.18 
b. Butyl methacrylate (“ BUMA ”) is a met hacrylate monomer that is used mainly 
in the manufacture of coating resins and acrylic polymers for surface coatings, 
where it imparts desirable properties, such as weatherability, UV resistance 
and flexibility, to acrylic lacquers and acrylic emulsion polymers for interior 
and exterior water-based paints.19 The Target manufactures both n-butyl 
methacrylate and i-butyl methacrylate.20 
c. Hydroxyesters or hydroxy methacrylates (“ HYMA”) is a methacrylate 
monomer that can be used in coatings, resins (including coating resins), 
polymers, and paints, are recommended for heat or room temperature cured 
coatings with permanent marring and solvent resistance, high gloss retention 
and weatherability and can also serve as adhesion promoters in reactive resins 
for bonding to metal surfaces.21 The Target manufactures 2-hydroxyethyl 
methacrylate, which is a clear, colourless liquid that can be used as an 
adhesion promoter for polymers, in thermosetting paints, hydrophilic polymers 
and light-curing polymer systems,22 and hydroxypropyl methacrylate, which is 
a functional monomer that can copolymerize with other monomers to produce 
copolymers with a hydroxy group in the side chain, and whose main 
applications are coatings and reactive resins.23 
d. Methacrylamide is a monomer whose amino functional variety manufactured 
by the Target can be used to improve pigment wetting and substrate adhesion 
to polymers and that can be used in coating resins, paints and coatings, paper, 
                                                 
16  Form CO, paragraph 2.  
17  IHS Chemical “Methyl Methacrylate Chemical Economics Handbook” (15 August 2016), provided as 
Annex 8 to the Form CO, p.71. 
18  IHS Chemical “Methyl Methacrylate Chemical Economics Handbook” (15 August 2016), provided as 
Annex 8 to the Form CO, p.74. 
19  IHS Chemical “Methyl Methacrylate Chemical Economics Handbook” (15 August 2016), provided as 
Annex 8 to the Form CO, p.74. 
20  Form CO, Table 24. 
21  Information on hydroxyesters o n the Target’s website: https://methyl-methacrylate-
monomers.evonik.com/product/visiomer/en/products/CHEMICAL-FUNCTIONALITIES/ .  
22  Form CO, Table 24; Product information for the Target’s 2 -hydroxyethyl methacrylate: 
http://www.neochemical.ru/File/TDS Visiomer HEMA 98.pdf  and 
http://www13.evonik.com/bk2/product finder/evonik productDetail.asp?padding=on&aktProdID=32
62.  
23  Form CO, Table 24; Product information for the Target’s hydroxypropyl methacrylate: 
http://www13.evonik.com/bk2/product finder/evonik productDetail.asp?padding=on&aktProdID=32
64. 
5 water, cosmetic and oil and gas applications.24 The Target also manufactures a 
bifunctional monomer that possesses both vinyl and hydroxymethyl groups, 
suitable for a range of applications from adhesives and binders in 
papermaking, textiles and non-wovens, to a variety of surface coatings and 
resins for varnishes, films and sizing.25 
(13) The Target also manufactures a small range of coatings using MMA and MMA 
derivatives for sale on the merchant market. 26 
(14) Other activities of the Target include the manufacture of: (i) PMMA molding 
compounds, which it sells on the merchant market and uses in a captive manner to 
manufacture acrylic products (such as sheets, blocks and pipes), also sold on the 
merchant market;27 and (ii) sodium cyanide and potassium cyanide, which are 
produced from hydrogen cyanide, a raw material in MMA production. 28 
(15) The Target has MMA and MMA derivatives production plants in Germany (at 
Worms and Wesseling), the USA (in Fortier, Louisiana) and China (in Shanghai).29 
4.2. The upstream markets – manufacture and supply of MMA and MMA 
derivatives 
4.2.1. Relevant product market definition 
4.2.1.1. The Notifying Party’s views  
(16) The Notifying Party submits that the exact market definition can be left open, as no 
competition concerns arise even on narrowly defined markets for MMA and each of 
the MMA derivatives separately.30  
(17) With regard to MMA in particular, the Notifying Party submits that a hypothetically 
distinct market for MMA should not be sub-segmented further given the highly 
homogenous nature of these products.31  
(18) With regard to MMA derivatives, notwithstanding the Notifying Party’s view that 
the relevant market can be defined for each MMA product separately,32 the 
Notifying Party submits that there is a degree of supply-side substitutability given 
that their manufacture results from modifications to the MMA production process. 
Therefore, in the Notifying Party’s view, the same production process and assets can 
be used to manufacture MMA and MMA derivatives and most suppliers of MMA 
are also capable of producing most MMA derivatives (and often do). The Notifying 
Party admits, however, that some adjustments to the MMA production process or the 
                                                 
24  Product information for the Target’s methacrylamid e products: 
http://www13.evonik.com/bk2/product finder/evonik productDetail.asp?padding=on&aktProdID=32
92 
25  Product information for the Target’s N-MMA methacrylamide monomer: 
https://corporate.evonik.com/en/products/search-products/pages/product-
details.aspx?productId=76118&searchText=methacrylamide . 
26  Form CO, paragraph 2.  
27  Form CO, paragraph 2.  
28  Form CO, paragraph 2. 
29  Form CO, paragraph 51 and footnote 17. 
30  Form CO, paragraphs 69 and 80. 
31  Form CO, paragraph 68. 
32   Email from the Notifying Party’s  legal counsel received at 20:37 on 17 April 2019. 
6 addition of specific production assets may be required to carry out the final reactions 
necessary to manufacture certain MMA derivatives (e.g. ethoxylation capa city in 
order to manufacture BUMA, and transesterification assets to convert MMA to 
HYMA).33 
(19) With regard to methacrylamide, which is derived from an intermediary step of the 
Target’s MMA manufacturing process (and not from MMA, as is the case with the 
other  MMA derivatives), the Notifying Party submits that the same market definition 
considerations apply as for other MMA derivatives, and that the market for the 
supply of methacrylamide may accordingly be viewed as a distinct product market.34 
4.2.1.2.  The Commission’s  assessment  
(20) In previous decisions, the Commission considered that:  
a. the supply of MMA  constitutes a separate product market, as it cannot be 
replaced by other products in the manufacture of follow -on products;35 
b. the supply of MAA  (the crude form of GMAA )36 constitutes a separate 
product market, distinct from MMA, since MAA and MMA confer different 
properties on the products into which they are processed and are not 
interchangeable from the user’s point of view;37 
c. the exact market definition for the supply of bu tyl methacrylate ( BUMA ) and 
its potential segmentation into n -butyl methacrylate and i -butyl methacrylate 
can be left open;38 and 
d. it cannot be excluded that hydroxy methacrylate ( HYMA ) and hydroxy 
acrylates belong to a single product market in view of the f act that, at the 
formulation stage, they appear to be substitutable for several applications 
(though the exact market definition was ultimately left open).39 
(21) The relevant product market for m ethacrylamide has not been previously defined  by 
the Commission .  
(22) The results of the market investigation carried out in the present case indicate that 
each of the markets for the manufacture and supply of MMA, GMAA, BUMA, 
HYMA and methacrylamide are likely to constitute a distinct relevant product 
market.  
(23) From a demand -side perspective, the majority of coating resin manufacturers that 
responded to the Commission’s market investigation consider each of MMA, 
GMAA, BUMA and HYMA to be an essential and irreplaceable component in their 
                                                 
33  Form CO, paragraphs 72 -75 and 80.  
34  Form CO, footnote 53.  
35  Case No IV/M.942 - Veba/Degussa , paragraph 14.  
36   GMAA is a refined grade of MAA. There have been no indications in this case that the market for 
methacrylic acid should be segmented by grade, nor have previous cases considered such a 
segmentation. Taking into account the products manufactured by the Target, for the purposes of this 
decision, MAA will be referred to as GMAA (i.e. its more  refined form).  
37  Case No IV/M.942 - Veba/Degussa , paragraph 15.  
38  Case M.5712 – Mitsubishi Chemical Holdings/Mitsubishi Rayon Co , para graphs  51-52. 
39  Case M.5927 – BASF/Cognis , paragraphs 88 -92. 
7 manufacturing processes for a significan t number of coating chemistries.40 As one 
customer explained: “ Methacrylate monomers are a major raw material critical for 
the production of many products in  [that customer’s ] coatings resin portfolio ”.41 A 
key reason for this is that each of these monomers imparts particular characteristics 
to the final product and, therefore, cannot be easily replaced by any other 
component.42 As another customer explained: “ Replacing methacrylates by other 
monomers changes the performance in the final application .”43 Hence, there seems 
to be very limited, if any, demand -side substitutability between MMA and the 
various MMA derivatives.  
(24) The results of the Commission’s market investigation also do not fully support the 
Notifying Party’s views on supply -side substitutability. In  particular, suppliers of 
MMA and MMA derivatives typically do not manufacture and supply the full range 
of monomers. While all those suppliers manufacture and sell MAA on the merchant 
market, a much more limited number of suppliers also supply GMAA, BUMA,  and 
even less so, HYMA and methacrylamide. According to the results of the market 
investigation, the Target may be the only supplier on the merchant market to supply 
all of MMA, GMAA, BUMA, HYMA and methacrylamide. Other suppliers sell 
predominantly MMA o r GMAA, and only a few sell BUMA or HYMA.44  
(25) Different suppliers of MMA and MMA derivatives also appear to have different 
strengths in the monomers they supply. For example, whilst the majority of 
respondents to the Commission’s market investigation have ranked the Target as the 
top supplier of GMAA, BUMA and methacrylamide in the EEA, another supplier 
was generally ranked higher than the Target for the supply of MMA and yet another 
supplier was ranked number one (tied with the Target) for the supply of HY MA.45 
(26) It is worthwhile to note, also, that different suppliers use different processes and 
even different variations of the same process for the manufacture of MMA, though 
the final product is generally considered to be identical and chemically 
indistinguis hable.46  
(27) There are three different processes for the manufacture of MMA that are currently 
commercialised: (1) the acetone cyanohydrin (“ACH”) process (the “ACH 
process”), (2) the oxidation/esterification of isobutylene or tertiary -butyl alcohol 
(“TBA”) (t he “TBA process”), and (3) the hydroformylation of ethylene to 
propionaldehyde, propionic acid, or methyl propionate (the “ethylene process”).47 
Each of these processes (and their variants) involve a different number of steps, use 
different feedstocks and p roduce different by -products, as well as entailing different 
                                                 
40  Responses to Q1 – Questionnaire to Competitors and Cus tomers, question 30.  
41  Responses to Q1 – Questionnaire to Competitors and Customers, question 30.1.  
42   See also Form CO, Table 4, where the Notifying Party explains the properties that are imparted by 
MMA and MMA derivatives, noting in particular that MM A can contribute to better UV resistance, 
exterior durability and hardness, BUMA can contribute to better scratch resistance, hardness and early 
hardness development, chemical resistance and temperature resistance, GMAA increases dry speed 
and helps provid e adhesion and HYMA can contribute to hardness development, chemical resistance 
and exterior durability.  
43  Response to Q1 – Questionnaire to Competitors and Customers, question 30.1.  
44  Responses to Q1 – Questionnaire to Competitors and Customers, questio n 5; Minutes of a call with an 
upstream competitor, 12 April 2019 at 4pm.  
45  Responses to Q1 – Questionnaire to Competitors and Customers, question 11.  
46   Minutes of a call with an upstream competitor, 12 April 2019 at 4pm.  
47   IHS Chemical “Methyl Methacrylate Chemical Economics Handbook” (15 August 2016), p.13  
8 steps for the manufacture of MMA derivatives, which may to a certain extent 
explain the differences in the supply by the different suppliers:  
a. The ACH process  typically involves three steps, namel y (i) the production of 
ACH from acetone and hydrogen cyanide, (ii) treating ACH with sulphuric 
acid to produce methacrylamide sulphate (iii) reacting methacrylamide 
sulphate with methyl alcohol to produce MMA (with sulphuric acid and 
ammonium bisulphate a s by-products). The crude MMA is then purified by 
distillation.48 Different variants of the ACH process exist. For example, the 
Mitsubishi Gas Chemical Company uses a different type of the ACH process 
that does not use sulphuric acid or generate by -product ammonium 
bisulphate.49 The Target’s own process is also a variant of the ACH process, 
one that employs an inorganic catalyst instead of sulphuric acid and does not 
generate the by -product ammonium bisulphate.50 To manufacture different 
methacrylates using th e ACH process, different alcohols are typically added 
to the MMA solution. For example, to manufacture BUMA, MMA is reacted 
with butyl alcohol (butanol).51 However, with respect to some of the other 
MMA derivatives at issue in this case specifically, their manufacture requires 
more modifications than simply substituting one type of alcohol for another 
in the same step of the manufacturing process. Thus, to manufacture GMAA, 
water is used instead of methanol in the third step of the reaction, resulting in 
MAA , which is then purified to produce GMAA.52 HYMA is produced from 
the esterification of GMAA.53 Methacrylamide is produced by stopping the 
second step of the ACH process and converting the resulting product, 
methacrylamide sulphate, to methacrylamide.54 
b. Some suppliers in Asia use the TBA process , which in the first step, oxidises 
TBA to methacrolein, which is then in turn oxidised to MAA in the second 
step, followed by the esterification of MAA with methanol to produce MMA 
in the third step.55 Compared to the A CH process, the TBA process uses a 
different feedstock,56 does not require hydrogen cyanide or sulphuric acid, 
does not generate acidic waste, but has higher capital costs per ton of 
capacity.57 In the TBA process, MAA (the crude form of GMAA) is actually 
an intermediate product for the production of MMA, instead of an alternative 
manufactured using a different alcohol, as is the case in the ACH process. A 
supplier based in Asia, Asahi, has developed a variant of the TBA process 
                                                 
48   IHS Chemical “Methyl Methacrylate Chemical Economics Handbook” (15 August 2016), p.13  
49   IHS Chemical “Methyl Methacrylate Chemical Economics Handbook” (15 August 2016), p.1 4. 
50   IHS Ch emical “Methyl Methacrylate Chemical Economics Handbook” (15 August 2016), p.1 4. 
51   Form CO, paragraph 73.  
52   Form CO, paragraph 73; IHS Chemical “Methyl Methacrylate Chemical Economics Handbook” (15 
August 2016), p.13  
53   Form CO, paragraph 73. 
54   Form  CO, paragraph 73.  
55   IHS Chemical “Methyl Methacrylate Chemical Economics Handbook” (15 August 2016), p.1 5. 
56   The TBA process use isobutylene, the prime sources for which are hydrocarbons by -product streams 
from catalytic cracking in refineries, ethyle ne production by steam cracking, cracking of heavy 
feedstocks e.g. naphtha or gas oil, isobutene, and n -butenes ( IHS Chemical “Methyl Methacrylate 
Chemical Economics Handbook” (15 August 2016), p.1 5). 
57   IHS Chemical “Methyl Methacrylate Chemical Economic s Handbook” (15 August 2016), p.1 5. 
9 that uses two steps instead of  three and has lower capital and production 
costs than the three -step process.58 
c. There are three variants of the ethylene process : the variant using 
propionaldehyde produces MMA in a series of four steps (with MAA 
produced as an intermediary product), where as the propionic acid variant and 
the methyl propionate variant consist of three and two reaction steps, 
respectively (the second of which does not entail the production of MAA as 
an intermediary step). Lucite International has a plant in Singapore that us es 
a proprietary variant of the ethylene process, the Alpha process, which 
consists of only two reaction steps and manufactures only small volumes of 
MAA as a by -product.59 
(28) A competitor active in the supply of several MMA monomers explained that, while 
there are no technical barriers to switching to the production of MMA derivatives, it 
does demand a long -term recoup plan on investment costs, as the markets for MMA 
derivatives are smaller than that for MMA.60 Nevertheless, entry into MMA 
derivatives by suppli ers that already own MMA production assets is still feasible as 
“the incremental capital to produce these is significantly lower than the capital 
required for MMA or MAA ”.61 Nevertheless, with regard to e.g. BUMA, a 
competitor estimates that “ once a produce r has an MMA asset, it would cost tens of 
millions of euros to install an asset to manufacture BUMA ”.62 
(29) On the basis of the above considerations supported by evidence collected over the 
course of the market investigation, the Commission considers that each of the 
markets for the supply of MMA, GMAA, BUMA, HYMA and methacrylamide 
likely constitutes a distinct product market. For the purposes of this decision, 
however, the exact product market definition can be left open, as no serious doubts 
arise under any p lausible market definition.  
4.2.2.  Geographic market definition  
4.2.2.1.  The Notifying Party’s views  
(30) The Notifying Party submits that the geographic scope of the supply of each of 
MMA, GMAA, BUMA, HYMA and methacrylamide is global in scope (and at least 
EEA -wide  in the c ase of methacrylamide).63  
(31) The Notifying Party argues that the supply of MMA (and therefore also of the MMA 
derivatives) exhibits features of a market that is wider than EEA in geographic 
scope, namely because of: (i) the significant trade flows across worl d regions (with 
imports of c.20% on the merchant market in the EU in 2017), (ii) expected increased 
imports into Europe from two new plants coming into production in Saudi Arabia, 
(iii) the low cost of transport of MMA and MMA derivatives (with the excepti on of 
GMAA, the transport costs of which are higher because temperature control is 
required), and (iv) the fact that supply can be, and has on previous occasions been, 
                                                 
58   IHS Chemical “Methyl Methacrylate Chemical Economics Handbook” (15 August 2016), p.1 5. 
59   IHS Chemical “Methyl Methacrylate Chemical Economics Handbook” (15 August 2016), p.1 7. 
60   Minutes of a call with an upstream  competitor, 12 April 2019 at 4 pm.  
61   Response to Q1 – Questionnaire to Competitors and customers, question 7.  
62   Minutes of a call with an upstream competitor, 12 April 2019 at 4pm.  
63  Form CO, paragraphs 84 -85 and footnote 53.  
10 diverted to other world regions (e.g. Europe or Asia) when market fluctuations 
meant tha t prices in those regions increased.64 
(32) In the Notifying Party’s view, the market definition can ultimately be left open as no 
competition concerns arise irrespective of whether these markets are defined as 
global or EEA -wide  in scope .65 
4.2.2.2.  The Commission’s asse ssment  
(33) The Commission has previously defined the geographic markets for the supply of 
MMA  and of MAA  (the crude form of GMAA ) as at least EEA -wide in scope and 
for the supply of hydroxy monomers (including HYMA ) as EEA -wide in scope, 
whereas it left open t he geographic scope of the markets for the supply of butyl 
methacrylate (including BUMA ).66 
(34) The results of the market investigation indicate that the markets for the supply of 
MMA and each of the MMA derivatives are likely to be EEA in geographic scope.  
(35) Whilst some of the competitors have indicated that they supply, and some of the 
customers indicated that they purchase, MMA and MMA derivatives on a global 
level, a significant number of customers that responded to the Commission’s market 
investigation ind icated that they tend to purchase MMA and MMA derivatives from 
EEA -based suppliers for use in the EEA.67 As one customer explained, “[ w]e are a 
global company but we buy methacrylates in Europe for the European plants (like 
we buy in China for our plant in China, in the US for the US plants, …)”.68  
(36) The reasons for choosing to source mainly from regional suppliers relate to a large 
extent to the limited shelf -life of MMA monomers and the related storage 
requirements. As another EEA -based customer explained, “ [d]ue to large volume 
requirements and only limited storage capabilities, short lead times are required to 
source monomers ”, which is why its “[ v]olumes are typically sourced from the main 
EEA countries in which monomers are produced ”.69 An MMA manufacturer  
explained that the typical shelf life of MMA and MMA derivatives is six months.70 
(37) Moreover, importing from outside the EEA may be difficult, if not impossible, for 
certain EEA -based customers due to a variety of economic, technical or regulatory 
factors. F or example, certain technical specifications of EEA customers require the 
use of specific stabilisers or inhibitors to make MMA and the relevant MMA 
derivatives safe for transport and subsequent handling and use in follow -on 
manufacturing processes. Produc ts from outside the EEA (e.g. Asia) often utilise 
Topanol -A, an inhibitor that is not suitable for use for certain applications in the 
                                                 
64  Form CO, paragraphs 81-83. 
65  Form CO, paragraph 86. 
66  Commission decisions in Case No IV/M.942 - Veba/Degussa , paragraph  36; Case M.5927 – 
BASF/Cognis , paragraphs  95-96; Case M.5712 – Mitsubishi Chemical Holdings/Mitsubishi Rayon 
Co, paragraph  58. 
67  Responses to Q1 – Quest ionnaire to Competitors and Customers, question 6 and question 19.  
68  Response to Q1 – Questionnaire to Competitors and Customers, question 19.1.  
69  Response to Q1 – Questionnaire to Competitors and Customers, question 19.1.  
70   Minutes of a call with an u pstream competitor, 12 April 2019 at 4 pm.  
11 EEA (where MEHQ is typically used).71 The water content or necessary temperature 
controls also entail additional costs,72 as do customs duties73 and additional risks and 
logistics considerations related to transportation of these chemicals over long 
distances.74  
(38) In addition, customers procuring volumes of MMA and MMA derivatives 
originating from outside the EEA do so via EEA -based traders precisely because 
they value geographic proximity. For example, one customer explained that it 
procures volumes of MMA and MMA derivatives from overseas but only via traders 
based in the Netherlands, Germany and the UK.75 Another customer explai ned that 
whilst they have approved non -EU sources in order to improve their security of 
supply and leverage global market dynamics, they do not import from any of their 
approved non -EEA suppliers themselves, relying instead on EEA -based importers.76 
(39) Further more, the reliability of imports of MMA and MMA derivatives from outside 
the EEA as competitive constraints in the EEA appears relative and unstable. First, 
according to the views expressed by MMA and MMA derivatives customers 
responding to the Commission’ s market investigation, imports are not always 
competitively priced as compared to monomers manufactured in the EEA. As one 
customer explained: “ If the market is tight with a strong demand in both regions, 
Asian imports can be at a premium to EU prices .”77 Another customer explained 
that the “[ c]ompetitiveness of imports of methacrylate monomers from outside the 
EEA is highly dependent on market circumstances ”, noting that “[ u]nder normal 
circumstances EEA produced material is more competitive .”78 This sugges ts that 
imports from outside the EEA remain opportunistic,79 becoming more significant at 
times markets in the EEA are disrupted and prices increase as a result of e.g. 
capacity restrictions at EEA -based manufacturing facilities.80 
(40) For these reasons, the Com mission finds that each of the geographic markets for the 
manufacture and supply of MMA, GMAA, BUMA, HYMA and methacrylamide is 
likely to be EEA -wide in scope. For the purposes of this decision, however, the exact 
geographic market definition can be left o pen, as no serious doubts arise under any 
plausible market delineations.  
                                                 
71 E.g. the standard inhibitor in Europe is MEHQ, whereas many Asian and North American suppliers 
typically use Topanol A, which market participants say may cause problems in specific areas of 
application. Response s to Q1 – Questionnaire to Competitors and Customers, question 19.4.  
72  For example, GMAA (or MAA) polymerises easily, which makes it more difficult to ship over long 
distances. Responses to Q1 – Questionnaire to Competitors and Customers, question 19.4.  
73  Minutes of a call with an upstream competitor, 12 April 2019 at 4pm.  
74  Responses to Q1 – Questionnaire to Competitors and Customers, question 19.4  
75  Response to Q1 – Questionnaire to Competitors and Customers, question 19.1.  
76  Response to Q1 – Questio nnaire to Competitors and Customers, question 19.1.  
77  Response to Q1 – Questionnaire to Competitors and Customers, question 19.3.  
78  Response to Q1 – Questionnaire to Competitors and Customers, question 19.3.  
79   Minutes of a call with an upstream competi tor, 12 April 2019 at 4pm.  
80  This view is supported by various market participants, including competitors, who do not generally 
seem to consider imports from outside the EEA as a significant competitive constraint on their 
activities in the EEA; see for example, responses to Q1 - Questionnaire to Competitors and Customers, 
questions 19.3 and 19.4.  
12 4.2.3.  Conclusion on the relevant markets for the manufacture and supply of MMA and 
MMA derivatives  
(41) On the basis of the above considerations supported by evidence collected over the 
course o f the market investigation, the Commission concludes that  each of the 
markets for the supply of MMA, GMAA, BUMA, HYMA and methacrylamide 
likely constitutes a distinct product market, which is  likely to be EEA -wide in 
geographic scope. For the purposes of t his decision, however,  both the exact product 
and geographic market definition can be left open, as no serious doubts arise on any 
plausible market definition . 
4.3. The downstream markets – manufacture and supply of coating resins  
4.3.1.  Relevant product market definition  
4.3.1.1.  The Notifying Party’s views  
(42) The Notifying Party submits that for the purposes of a vertical assessment, the 
coating resins market should be viewed as one single market without further 
segmentation .81 In the Notifying Party’s view, a further sub -segmentation is not 
appropriate because: (i) coating resin manufacturers operate multi -purpose reactors 
in which they can easily switch between coating resin chemistries (and Allnex does 
so often, at very limited cost of between EUR 1 500 and EUR 3 000 and only a few 
hours of cleaning on average), (ii) customers can switch between different resin 
chemistries to achieve the desired effects in a coating for a particular end -use; (iii) 
coating resin manufacturers do not tend to be aware of their customers’ inte nded use 
of a given resin chemistry or, if they are, they are not willing to share this 
information with other third parties, meaning that any market estimates on narrower 
sub-segments are often only very high -level.82 
(43) The Notifying Party further submits that in any event, the exact market definition 
can be left open as no competition concerns arise on any plausible market 
definition.83 
4.3.1.2.  The Commission’s assessment  
(44) The Commission has previously considered84 a possible segmentation of the market 
for the supply of coating resins by chemistry  and delivery technology  as well as by 
industrial application : 
a. A segmentation by chemistry  and delivery technology  distinguishes 
between the following categories of coating  resins: (i) solvent -borne acrylics, 
(ii) solvent -borne alkyds, (iii) water -borne acrylics, (iv) water -borne alkyds, 
(v) water -borne epoxies, (vi) water -borne polyurethane dispersions, (vii) 
cathodic electro -deposition resins, (viii) radiation -
curablemonom ers/oligomers/acrylates, (ix) radiation -curable UV -curable 
polyurethane dispersions, (x) radiation -curable glass laminates, and (xi) 
polyester powders.  
                                                 
81  Form CO, paragraph 107.  
82  Form CO, paragraph 95.  
83  Form CO, paragraph 107.  
84   Case M.8019 – Advent International/Nuplex Industries , paragraphs 14 -15 and 22 -30; Case M.6778 – 
Advent International Corporation/ Cytec's Resin Business , paragraph 71.  
13 b. A segmentation by industrial application  distinguishes between the 
following end -use applications for co ating resins (within each chemistry): (i) 
automotive OEM, (ii) automotive refinish, (iii) industrial wood, (iv) coil and 
PCM, (v) other industrial, (vi) marine, (vii) special purpose, (viii) packaging, 
(ix) architectural, and (x) adjacent coating and non -coating.  
(45) In Advent International/Nuplex Industries , the Commission concluded that, based on 
the results of the market investigation in that case, a segmentation of the market 
based on (i) the delivery technology (e.g. liquid or powder) and the resin chemist ry 
(e.g. acrlyics or alkyds) and (ii) industrial application (e.g. automotive OEM or 
architectural)  was likely to be the most suitable (e.g. solvent -borne acrylics for 
automotive OEM), though ultimately leaving the exact relevant product market 
definition  open.85 
(46) The results of the market investigation carried out in the present case confirm the 
segmentation of the coating resins market by chemistry and delivery technology and 
by industrial application.  
(47) The vast majority of coating resins manufacturers tha t responded to the 
Commission’s market investigation agree with the segmentation by chemistry and 
delivery technology and by industrial application outlined in paragraphs (44)a ) and 
(44)b ) above.86 As competitors explained with regard to the segmentation by 
chemistry and delivery technology, “[ t]hese categories provide a good coverage for 
different market segments based on technology/chemistry platforms ”87 and “[ f]rom a 
chemical c lassification point of view, this segmentation is generally followed and 
corresponds to the main types of product categories ”88 and with regard to the 
segmentation by end -use: “ It reflects standard industry segmentation practice ”.89 
One competitor explained in particular that markets “ are determined by a) chemistry 
an[d] b) application. Within each application there are possibly separate 
chemistries. Each chemistry can be used in different applications .”90 
(48) The vast majority of coating resin customers that resp onded to the Commission’s 
market investigation also agreed with this segmentation by chemistry and delivery 
technology and by industrial application,91 noting that these different chemistries 
reflected the “ different performance ” of the coating resins92 and that this 
segmentation by industrial application is “ commonly used ” within the industry and is 
based on linking the product specificities to their application, “ as the technical 
requirements are different ” for different uses.93 
(49) From the demand -side per spective, therefore, coating resins do not appear to be 
substitutable between different chemistries and end -applications. As one customer 
stated: “ Different types of resins  are not substitutable because of their different 
properties .”94 Another customer exp lained in more detail that: “ The types of 
                                                 
85   Case M.8019 – Advent International/Nuplex Industries , paragraphs 22 and 30.  
86  Responses to Q1 – Questionnaire to Competitors and Custome rs, question 26 and question 26.2.  
87  Response to Q 1 – Questionnaire to Competitors and Customers, question 26.1.  
88  Response to Q 1 – Questionnaire to Competitors and Customers, question 26.1.  
89  Response to Q 1 – Questionnaire to Competitors and Custome rs, question 26.3.  
90  Response to Q 1 – Questionnaire to Competitors and Customers, question 26.1.  
91  Responses to Q2 – Questionnaire to Customers, question 4 and question 4.2.  
92  Response to Q2 – Questionnaire to Customers, question 4.1.  
93  Responses to Q 2 – Questionnaire to Customers, question 4.3.  
94  Response to Q2 – Questionnaire to Customers, question 4.1.  
14 (specialty) resins used in one end -use application are generally not substitutable 
with the types of (specialty) resins used in another end -use application. Indeed, 
depending on the end -use application, the market needs and end requirements are 
different. Different types of resins are therefore used because of the properties they 
provide, such as chemical resistance, hardness, durability, curing time etc. as well 
as because of the application and curing method, and the substrate coated (metal or 
plastic). Their chemical composition and properties would differ, as well as the 
prices .”95  
(50) As regards supply -side substitutability, the results of the market investigation did not 
confirm the Notifying Party’s view that it i s generally easy to switch production 
lines across the different coating resin chemistries and applications. Whilst some 
coating resins manufacturers that focus on specific chemistries report being able to 
switch their production lines between their target ed resin chemistries, others say it 
would be very difficult for them to do so or that it “ is not possible in general ”.96 The 
reasons for this are numerous: the costs of reformulating recipes to use different raw 
materials may be very high, as are the costs of testing the reformulated coating resins 
for their intended end -applications by producers and customers alike.97  
(51) On the basis of the above considerations supported by evidence collected during the 
market investigation, the Commission considers that it is  appropriate to maintain the 
Commission’s practice of segmenting the supply of coating resins by chemistry and 
delivery  technology and by industrial application, as outlined in paragraphs (44)a ) 
and (44)b ) above. For the purposes of the present decision, however, the exact 
product market definition can be left open, as no serious doubts arise under any 
plausible market delineations.  
4.3.2.  Geographic market definition  
4.3.2.1.  The Notifying Party’s views  
(52) The Notifying Party  submits that the supply of coating resins exhibits several 
features of a global or at least EEA -wide market, including: (i) low transportation 
costs, (ii) no regulatory barriers to trade across jurisdictions, and (iii) converging 
global pricing (with the exception of Asia, where prices are lower).98 However, 
according to the Notifying Party, the exact geographic market definition can be left 
open as no competition concerns arise under any plausible geographic market 
definition.99 
4.3.2.2.  The Commission’s assessment  
(53) The Commission has previously considered the geographic market for the supply of 
coating resins (including water -based resins) to be EEA -wide in scope.100 
(54) In the present case, the results of the market investigation suggest that the markets 
for coating resin s are likely to be EEA -wide in geographic scope.  
                                                 
95  Response to Q2 – Questionnaire to Customers, question 4.3.  
96  Response to Q1 – Questionnaire to Competitors and Customers, question 29.  
97  Respon ses to Q1 – Questionnaire to Competitors and Customers, question 29.  
98  Form CO, paragraphs 108 -109. 
99  Form CO, paragraph 110.  
100  Case M.6178 – Arkema/Total’s Resin Division , paragraphs 24 -25; Case M.5355 - BASF/CIBA , 
paragraphs  173-174. 
15 (55) Whilst some of the coating resins manufacturers that responded to the Commission’s 
market investigation indicated that they can sell coating resins on a global level, it is 
apparent that a number of these sa me suppliers typically serve customers at the EEA 
level. For example, one competitor stated: “ We can supply globally, but typically we 
manufacture in the region which we serve ”.101 Another explained that “[ m]ain 
supplies are going into EEA, and only small vo lumes outside EEA ”.102 
(56) From the demand -side, the customers of coating resins tend to procure at the EEA 
level, typically from different EEA countries to diversify their supplier base. 
Regulatory requirements may render coating resins manufactured by non -EEA 
manufacturers unsuitable for EEA -based customers.  Those responding customers 
that stated that they procure coating resins on a global level explain that they have 
“global manufacturing sites ” or “ factories in different regions ” and that “[ s]ome 
grades/typ es of [coating resins ] are not available locally hence  [they] need to import 
them ”.103 
(57) For these reasons, the Commission find s that the geographic markets for the supply 
of coating resins, including their possible segmentation by chemistry  and delivery 
technology  and by industrial application, are likely to be EEA -wide in scope.  For the 
purposes of this decision, however, the exact geographic market definition can be 
left open, as no serious doubts arise under any plausible market definitio n.  
4.3.3.  Conclusion on the relevant markets for the manufacture and supply of coating resins  
(58) On the basis of the above considerations supported by evidence collected during the 
market investigation, the Commission considers it appropriate to segment the market 
for the supply of coating resins by chemistry and delivery technology and by 
industrial application, as outlined in paragraphs (44)a ) and (44)b ) above, and to 
consider these markets to be EEA -wide in scope. However, the exact market 
definitions can be left open, as no serious doubts arise on any  plausible market 
definition.  
5. COMPETITIVE ASSESSMEN T 
5.1. Horizontal non -coordinated effects  
5.1.1.  Legal framework for the competitive assessment  
(59) A merger giving rise to significant impediment of effective competition  may do so 
as a result of the creation or streng thening of a dominant position in the relevant 
market (s). Moreover, m ergers in oligopolistic markets involving the elimination of 
important constraints that the parties previously exerted on each other, together with 
a reduction of competitive pressure on the remaining competitors, may also result in 
a significant impediment to effective competition , even in the absence of 
dominance .104 
                                                 
101  Response to Q1  – Questionnaire to Competitors and Customers, question 27.1.  
102  Response to Q1 – Questionnaire to Competitors and Customers, question 27.1.  
103  Response to Q2 – Questionnaire to Customers, question 6.2.  
104 Horizontal Merger Guidelines, paragraph 25.  
16 (60) In fact, the Commission Guidelines on the assessment of horizontal mergers under 
the Merger Regulation (the “Horizontal Merg er Guidelines”)105 describe horizontal 
non-coordinated effects as follows: “ A merger may significantly impede effective 
competition in a market by removing important competitive constraints on one or 
more sellers who consequently have increased market power.  The most direct effect 
of the merger will be the loss of competition between the merging firms. For 
example, if prior to the merger one of the merging firms had raised its price, it 
would have lost some sales to the other merging firm. The merger removes this 
particular constraint. Non -merging firms in the same market can also benefit from 
the reduction of competitive pressure that results from the merger, since the merging 
firms’ price increase may switch some demand to the rival firms, which, in turn, ma y 
find it profitable to increase their prices. The reduction in these competitive 
constraints could lead to significant price increases in the relevant market .”106 
(61) The Horizontal Merger Guidelines list a number of factors which may influence 
whether or not s ignificant horizontal non -coordinated effects are likely to result from 
a merger, such as the large market shares of the merging firms, the fact that the 
merging firms are close competitors, the limited possibilities for customers to switch 
suppliers, or t he fact that the merger would eliminate an important competitive 
force.107 That list of factors applies equally regardless of whether a merger would 
create or strengthen a dominant position, or would otherwise significantly impede 
effective competition due t o non -coordinated effects. Furthermore, not all of these 
factors need to be present to make significant non -coordinated effects likely and it is 
not an exhaustive list.108  
(62) Finally, the Horizontal Merger Guidelines describe a number of factors, which could 
counteract the harmful effects of the merger on competition, including the likelihood 
of buyer power, the entry of new competitors on the market, and efficiencies.  
(63) For the purposes of the competitive assessment of this case, in this Section, the 
Commission will assess whether the Transaction gives rise to horizontal non -
coordinated effects. 109 
5.1.2.  Market shares  
(64) The Transaction gives rise to horizontal overlaps in the supply of solvent -borne 
(“SB”) acrylic coating resins. On the narrowest market segmentation for the supply 
of coating resins (by chemistry and technology and by industrial application) in the 
EEA, th ree affected markets arise as a result of horizontal overlaps: solvent -borne 
                                                 
105  OJ C  31, 5.2.2004, p. 5.  
106 Horizontal Merger Guidelines, paragraph 24.  
107 Horizontal Merger Guidelines, paragraphs 27 and following . 
108 Horizontal Merger Guid elines, paragraph 26.  
109  The competitive assessment of the horizontal overlaps arising from the Transaction focuses on non -
coordinated effects. Conversely, the results of the market investigation and documents obtained from 
the Parties did not reveal specific evidence pointing to a risk of coordinated effects in the present 
case. In particular, a large number of heterogeneous actors active across different combinations of 
resin chemistries and end -use applications will continue to compete in the relevant coating resins 
markets post -Transaction. Moreover, some of the products developed by competitors in these markets 
are tailor -made for each customer to fit their needs  (e.g. for automotive applications); other customers 
of coating resins tend to procure off -the-shelf products for use  in more standard applications (e.g. wall 
paints) . In view of these structural and circumstantial features, the present decision does not inquire 
further into potential coordinated effects in the supply of solvent -borne acrylic coating resins or  in 
each of  the marine, other industrial, or adjacent coating and non -coating applications , in which the 
Parties’ activities overlap . 

18 5.1.4.1.  Supply of SB acrylic resins (all applications combined)  
(67) Competition concerns are unlikely to arise as a consequence of the Parties’ 
horizontal overlap in the market for the supply of SB acrylic resins for all 
applications (where the Part ies have an estimated combined market share  of 16 -20% 
and an increment of [5-10]%) for the following reasons.  
(68) The results of the Commission’s market investigation reveal  that for the plausible 
market encompassing the supply of all SB acrylic resins regardl ess of the end -use 
application, the combined market share of the Parties would remain relatively 
modest and multiple competitors appear to be able to constrain the merged entity 
post-Transaction, including Arkema, Synres, Dow or BASF, among others.112   
(69) More over, while some coating resins manufacturers have long -term relationships 
with customers, supply contracts are generally of a short duration in this industry 
(typically ranging between several months and 1 or 2 years113).114 Likewise, 
customers of SB acrylic resins agree that m ulti-sourcing is a common practice  and 
that switching is possible in the industry ,115 even though it may require finding a 
supplier that meets specific formulations or characteristics required by the 
customer.116   
(70) In addition, as regards the Parties’ horizontal overlaps in SB acrylic resins, the 
results of the market investigation suggest that the large majority of customers and 
competitors do not expect the Transaction to have a material impact on their 
business.117 More importantly, the ma jority of customers expects that there will 
remain a sufficient number of suppliers in the market, and that there will be no 
increase in price or decrease in the quality of the product available in the market.118  
(71) The Commission accordingly considers that th e Transaction does not raise serious 
doubts as to its compatibility with the internal market as a result of horizontal 
overlaps in the Parties’ activities in the possible EEA market for the supply of SB 
acrylic resins.  
5.1.4.2.  Supply of SB acrylic resins for marin e applications  
(72) Competition concerns are unlikely to arise as a consequence of the Parties’ 
horizontal overlap in the market for the supply of SB acrylic resins for marine  
applications for the following reasons.  
(73) First, the Parties’ combined market share is  relatively modest, estimated by the 
Notifying Party to be [20-25]%, and the increment brought about by the Transaction 
is limited ( [0-5]%). 
                                                 
112  Responses to Q2 – Questionnaire to Customers, question 10.  
113  Responses to Q1 – Questionnaire to Competitors and Customers, question 14.1 and question 23.1.  
114  Responses to Q1 –  Questionnaire to Comp etitors and Customers, question  33. 
115  Responses to Q2 – Questionnaire to Customers, questions 14 and 14. 1. 
116  Responses to Q1 – Questionnaire  to Competitors and Customers, question s 29 and 33. Responses to 
Q2 – Questionnaire  to Customers, question 14.1.  
117  Responses to Q1 – Questionnaire to Competitors and Customers, question  40; Response s to Q2 – 
Questionnaire to Customers, question 17.  
118  Responses to  Q2 - Questionnaire  to customers, question  16. 
19 (74) Second, the market is fragmented, with many competitors remaining available as 
alternative suppliers post -Transacti on, including Arkema (with an estimated market 
share of 10 -15%), BASF ( 5-10%), Dow (5 -10%), Synres ( 10-15%), and a number of 
other competitors representing about a third of the market (28 -48%).119  
(75) Third, the majority of customers of SB acrylic resins for ma rine applications that 
responded to the Commission’s market investigation do not expect the Transaction 
to result in any price increases, reductions in quality or choice.120 The majority of 
these SB acrylic resins customers, and specifically the majority of customers of SB 
acrylic resins for marine applications, have indicated that a number of strategies 
would be available to them to respond to any increases of prices or decreases in 
volumes post -Transaction, including procuring adequate volumes of comparable  
quality and at comparable prices from alternative suppliers in the EEA.121  
(76) The majority of competing suppliers of SB acrylic resins that responded to the 
Commission’s market investigation similarly do not expect the Transaction to result 
in any price incre ases, reductions in quality or choice in any of the SB acrylic resins 
for any end -applications.122 These conclusions did not significantly change for 
suppliers of SB acrylic resins for marine applications.  
(77) The Commission accordingly considers that the Trans action does not raise serious 
doubts as to its compatibility with the internal market as a result of horizontal 
overlaps in the Parties’ activities in the possible EEA market for the supply of SB 
acrylic resins for marine applications.   
5.1.4.3.  Supply of SB acryli c resin for adjacent coating and non -coating applications  
(78) As regards the market for the supply of SB acrylic resins for adjacent coating and 
non-coating applications (which includes resins not assigned to specific coating 
applications, such as textile or i nks, and resins used for non -coatings applications 
such as rubber, tires and adhesives123), the Transaction is unlikely to raise any 
competition concerns for the following reasons.  
(79) First, the Parties’ combined market share is relatively modest, estimated to  be [25-
30]%. In addition, the increment brought about by the Transaction is limited ( [5-
10]%). 
(80) Second, the market is fragmented, with many competitors remaining available as 
alternative suppliers post -Transaction, including Arkema (with an estimated marke t 
share of 10 -15%), BASF ( 5-10%), Dow (5 -10%), Synres ( 10-15%), and a number of 
other competitors representing about a third of the market (25 -45%).124 
(81) Third, all customers of SB acrylic resins for adjacent coating and non -coating 
applications that responded  to the Commission’s market investigation125 do not 
expect the Transaction to result in any price increases, reductions in quality or 
                                                 
119  Based on the Notifying Party’s estimates.  
120  Response s to Q2 – Questionnaire to Customers, questions 16.1, 16.2, 16.3, and 18.  
121  Responses to Q2 – Questionnaire to Customers, question 19.  
122  Responses to Q1 – Questionnaire to Competitors and Customers, questions 38.1, 38.2, 38.3 and 38.4.  
123   Case M.8019 – Advent International/Nuplex Industries , paragraph 13.  
124  Based on the Notifying Party’s market estimates.  
125   See responses to Q2 – Questionnaire to Customers, question 9.  
20 choice.126 The majority of these SB acrylic resins customers have indicated that a 
number of strategies would be available to them to respond to any increases of prices 
or decreases in volumes post -Transaction, including procuring adequate volumes of 
comparable quality and at comparable prices from alternatives suppliers in the 
EEA.127  
(82) The majority of competing manufacturers of SB  acrylic resins active in adjacent 
coating and non -coating applications that responded to the Commission’s market 
investigation128  similarly do not expect the Transaction to result in any price 
increases, reductions in quality or choice in any of the SB acr ylic resins for any end -
applications, including adjacent coating and non -coating applications.129 
(83) The Commission accordingly considers that the Transaction does not raise serious 
doubts as to its compatibility with the internal market as a result of horizont al 
overlaps in the Parties’ activities in the possible EEA market for the supply of SB 
acrylic resins for adjacent coating and non -coating applications.   
5.1.4.4.  Supply of SB acrylic resin for other industrial applications  
(84) As regards the market for the supply of SB acrylic resins for other industrial 
applications, the Transaction is unlikely to raise any competition concerns for the 
following reasons.  
(85) First, the Parties’ combined ma rket share is estimated to be [30-35]%, with an 
increment of [5-10]%.130  
(86) Second, the  market is fragmented, with many competitors remaining available as 
alternative suppliers post -Transaction, including Arkema (with an estimated market 
share of 20 -25%), Dow (10 -15%), Synres (5 -10%), and a number of other 
competitors (e.g. Synthopol, Mitsub ishi, DSM) representing about a quarter of the 
market (17 -32%).131 Indeed, the vast majority of SB acrylic resins customers  that 
responded to the Commission’s market investigation, including specifically those 
active in the other industrial applications segm ent, have stated that a sufficient 
number of suppliers of SB acrylic coating resins will remain in the EEA post -
Transaction.132 
(87) Third, the vast majority of customers for SB acrylic resins for other industrial  
applications that responded to the Commission’s market investigation do not expect 
the Transaction to result in any price increases, reductions in quality or choice.133 
The majority of these SB acrylic resins customers for other industrial applications 
have indicated that a number of strategies would be a vailable to them to respond to 
any increases of prices or decreases in volumes post -Transaction, including 
                                                 
126  Responses to Q2 – Questionnaire to Customers, questions 16.1, 16.2 and 16.3.  
127  Responses to Q2 – Questionnaire to Customers, question 19.  
128   See responses to Q1 – Questionnaire to Competitors and Customers, questions 1 and 31.  
129  Responses to Q1 – Questionnaire to Competitors and Customers, questions 38.1, 38.2, 38.3 and 38.4.  
130   Such a market share is well below the threshold at which dominance is likely to exist: see judgment 
of 3 July 1991, AKZO , C-62/86, EU: C:1991:286 , paragraph 60.  
131  Based on the Notifying Party’s market estimates.  
132  Responses to Q2 – Questionnaire to Customers, question 18.  
133  Responses to Q2 – Questionnaire to Customers, questions 16.1, 16.2 and 16.3.  
21 procuring adequate volumes of comparable quality and at comparable prices from 
alternatives suppliers in the EEA.134  
(88) All competing manufacturers activ e in SB acrylic resins for other industrial 
applications that responded to the Commission’s market investigation similarly do 
not expect the Transaction to result in any price increases, reductions in quality or 
choice in any of the SB acrylic resins for a ny end -applications, including other 
industrial applications.135 
(89) The Commission accordingly considers that the Transaction does not raise serious 
doubts as to its compatibility with the internal market as a result of horizontal 
overlaps in the Parties’ activ ities in the possible EEA market for the supply of SB 
acrylic resins for other industrial applications.   
5.1.5.  Conclusion  
(90) On the basis of the above considerations and the evidence collected during the 
market investigation, the Commission concludes that the Tran saction does not raise 
serious doubts as to its compatibility with the internal market, because it is unlikely 
to give rise to horizontal non -coordinated effects in the markets for the  supply of 
solvent -borne acrylic resins, both taken as a whole and for e ach of (i) marine, (ii) 
adjacent coating and non -coating, and (iii) other industrial applications.  
5.2. Non-horizontal non -coordinated effects  
5.2.1.  Legal framework for the competitive assessment  
(91) Mergers may involve vertical effects when concerning companies opera ting at 
different levels of the same supply chain. Pursuant to the Commission Guidelines on 
the assessment of non -horizontal mergers under the Council Regulation on the 
control of concentrations between undertakings (the “Non -Horizontal Merger 
Guidelines”) ,136 the analysis of the vertical effects of mergers does not entail the loss 
of direct competition between merging firms in the same relevant market and 
provide scope for efficiencies. However, there are circumstances in which vertical 
mergers may significa ntly impede effective competition. This is in particular the 
case if they give rise to foreclosure. 137  
(92) The Non -Horizontal Merger Guidelines distinguish between two forms of 
foreclosure: input foreclosure, where the merger is likely to raise costs of 
downst ream rivals by restricting their access to an important input, and customer 
foreclosure, where the merger is likely to foreclose upstream rivals by restricting 
their access to a sufficient customer base. 138  
(93) Pursuant to the Non -Horizontal Merger Guidelines,  input foreclosure arises where, 
post-merger, the merged entity would be likely to restrict  its actual or potential rivals 
in the downstream market from having access to the products or services that the 
Parties would have otherwise supplied absent the mer ger, thereby raising its 
                                                 
134  Responses to Q2 – Questionnaire to Customers, question 19.  
135  Responses to Q1 – Questionnaire to Competitors and Customers, questions 38.1, 38.2, 38. 3 and 38.4.  
136  OJ C 265, 18.10.2008, p. 6.  
137 Non-Horizontal Merger Guidelines, paragraph 18.  
138 Non-Horizontal Merger Guidelines, paragraph 30.  
22 downstream rivals' costs by making it harder for them to obtain supplies of the input 
under similar prices and conditions as absent the merger. 139  
(94) For input foreclosure to be a concern, the merged entity should have a significant 
degree of market power in the upstream market. Only when the merged entity has 
such a significant degree of market power, can it be expected that it will be able to 
significantly influence the conditions of competition in the upstream market and 
thus, possi bly, the prices and supply conditions in the downstream market.140 
(95) Pursuant to the Non -Horizontal Merger Guidelines, customer foreclosure may occur 
when a supplier integrates with an important customer in the downstream market 
and, because of this downstream  presence, the merged entity may foreclose access to 
a sufficient customer base to its actual or potential rivals in the upstream market (the 
input market) and reduce their ability or incentive to compete which in turn, may 
raise downstream rivals' costs b y making it harder for them to obtain supplies of the 
input under similar prices and conditions as absent the merger. This may allow the 
merged entity profitably to establish higher prices on the downstream market. 141  
(96) For customer foreclosure to be a concern, a vertical merger must involve a company 
that is an important customer with a significant degree of market power in the 
downstream market. If, on the contrary, there is a sufficiently large customer base, at 
present or in the future, that is likel y to turn to independent suppliers, the 
Commission is unlikely to raise competition concerns on that ground.142 
(97) In its assessment, the Commission considers whether it is likely that the merged 
entity would engage in input or customer foreclosure strategies. In doing so, the 
Commission in principle analyses the merged entity's ability and incentives to 
engage in such foreclosure strategies, as well as the possible effects they may have 
on the relevant markets. Since these factors are intrinsically linked, they  are often 
examined together.143 
5.2.2.  Market shares and overview of vertical relationships  
(98) Table 2 displays the market shares of the Target and its main compet itors (based on 
the merchant market, excluding captive supplies) in the upstream supply of MMA 
and MMA derivatives.   
                                                 
139 Non-Horizontal Merger Guidelines, paragraph 31.  
140 Non-Horizontal Merger Guidelines, paragraph 35.  
141 Non-Horizon tal Merger Guidelines, paragraph 58.  
142 Non-Horizontal Merger Guidelines, paragraph 61.  
143  Non-Horizontal Merger Guidelines, paragraphs 32 and 59.  



26 38% of Western European demand for MMA),150 molding compounds, impact 
modifiers, and  others. Indeed, the percentage of all MMA destined to the coating 
resins market in Western Europe is well below <25%,151 indicating that alternative 
customers remain available to MMA manufacturers. Thus, a theoretical customer 
foreclosure strategy would at most have a limited effect on the market. Given the 
lack of ability and the limited impact that such strategy would have on the market, 
the merged entity is unlikely to also have the incentive to do so as it is unlikely that 
any foreclosure strategy could be successfully implemented.   
(104)  In view of the above considerations supported by evidence collected during the 
market investigation, the merged entity appears unlikely to have the ability and 
incentive to implement a customer foreclosure strategy in the pre sent case .  
5.2.4.  Potential input foreclosure  
5.2.4.1.  The Notifying Party’s views  
(105)  The Notifying Party submits that the merged entity would lack the ability and/or the 
incentive to foreclose its downstream rivals  post-Transaction, and that even if it were 
to do so, such foreclosure would have very little effect on competition. First, in the 
Notifying Party’s view, MMA and MMA derivatives are simply an additive and not 
an essential input in the manufacture of most coating resins, such as SB/WB 
acrylics, SB/WB alkyds, polyu rethanes and epoxy resins. Moreover, certain other 
coating resins do not generally make use of MMA or MMA derivatives at all, such 
as e.g. polyester powders or the majority of radiation -curable monomers. The 
Notifying Party highlights that even within coat ing resins of a certain chemistry 
category, MMA derivatives are not used for all end -use applications. The Notifying 
Party further argues that, in any event, when MMA and MMA derivatives are added 
to a resin, they represent a limited share of the total raw  material cost for resin 
production, e.g. from 5 -10% in WB PUDs up to 45 -50% in polyester powders.  
(106)  Second, the Notifying Party submits that despite the Target’s EEA market shares 
being slightly above the 30% threshold for most MMA derivatives (with the 
exception of methacrylamide), the Target does not have a position of dominance in 
these markets. There are several other producers available, such as Lucite (all MMA 
derivatives, with the exception of methacrylamide), GEO and Nippon (HYMA), as 
well as other manufacturers with occasional spot sales of MMA derivatives in the 
market such as BASF or Dow. The Notifying Party also anticipates an expansion in 
the availability of MMA and MMA derivatives in the EEA with the increase of 
imports from China and Saudi Ara bia. 
(107)  Third, in the opinion of the Notifying Party, given that the majority of coating resin 
manufacturers are active across a variety of coating resin chemistries and end -use 
applications, the merged entity could not successfully implement a foreclosure 
strategy targeted on the demand for certain resin chemistries and end -use 
applications (i.e., those produced by Allnex). This is because the merged entity 
would not have the ability to price differentiate for all the different uses for which a 
purchaser woul d be acquiring MMA derivatives. Thus, the merged entity would 
have to raise prices for its MMA derivatives regardless of the use by the purchaser, 
                                                 
150  IHS Chemical Methyl Methacrylate – Chemical Economics Handbook, 15 August 2016, pg.46.  
151  IHS Chemical Methyl Methacrylate – Chemical Economics Handbook, 15 August 2016, pg.46.  
27 potentially leading to an irrecoverable decrease in upstream sales, and hence 
discouraging the recourse to su ch strategy in the first place.  
(108)  Fourth, the Notifying Party argues that even if the merged entity had the incentive to 
completely stop all sales to Allnex’s main competitors, the market would still have 
sufficient spare capacity to supply the vast majority  of demand. This is true for 
MMA (Target sales to Allnex competitors: [Target’s volume of sales to Allnex’s 
competitors] ; estimated EEA spare capacity [35-40]kt), GMAA (Target sales to 
Allnex competitors: [Target’s volume of sales to Allnex’s competitors] ; estimated 
EEA spare capacity [5-10]kt), and HYMA (Target sales to Allnex competitors: 
[Target’s volume of sales to Allnex’s competitors] ; estimated EEA spare capacity 
[5-10]kt).152 For BUMA, estimated EEA spare capacity would be slightly smaller 
than the Target’s current sales to Allnex’s competitors ( [Target’s volume of sales to 
Allnex’s competitors] ; spare capacity [5 -10]kt), but the remaining [0 -5]kt could be 
purchased from other  regions, including through traders.  
(109)  Fifth, as concerns methacrylamide, the Notifying Party argues that it represents a 
very minor input to coating resins, representing a very small fraction of the total raw 
material costs for development of SB acrylic re sins (i.e. <0.0001%), and that 
products using methacrylamide can be reformulated without incurring significant 
costs.  
(110)  Lastly, the Notifying Party submits that if the merged entity were to attempt an input 
foreclosure strategy, their customers (i.e. coatin g resin manufacturers) would be able 
to adjust and retaliate in order to make this option unattractive to the merged entity. 
As most customers generally purchase multiple MMA derivatives from the same 
upstream producer, any attempt to foreclose access to a ny given input would result 
in retaliation from the customers, who could stop purchasing other inputs. In 
addition, customers could easily replace MMA and MMA derivatives in their 
formulas and continue competing in the coating resins market without them wi thin a 
reasonable timeframe. Moreover, as some major customers are  integrated upstream 
into MMA or MMA derivatives (e.g. BASF, Arkema, Dow)153, any foreclosure 
strategy would have no effect on them as they would continue having access to the 
MMA derivatives from their own captive production.  
5.2.4.2.  The Commission’s assessment  
(a) General results from the market investigation  
(111)  This section discusses the general results from the market investigation as regards 
the potential input foreclosure to downstream competitors. The  competitive 
assessment of the vertical link between coating resins with each of MMA, GMAA, 
BUMA, HYMA and methacrylamide is presented in the subsequent sections.  
(112)  Contrary to what is claimed in the Parties’ submissions, the Commission finds that 
the resul ts of the market investigation suggest that MMA and some MMA 
derivatives (and, in particular, GMAA and BUMA) are essential154 for at least a 
                                                 
152  Form CO, Table 20.  
153  Form CO, Table 23.  
154   According to paragraph 34 of the Non -Horizontal Merger Guidelines, input foreclosure may raise 
competition problems only if it concerns an important input for the downstream products, which may 
be the case if the input is a " critical component without which the downstream product could not be 
manufactured or effectively sold on the market ”. 

29 (113)  The market investigation also confirmed that a significant number of competitors (7) 
are integrated upstream into the production of MMA and other methacrylate 
monomers, though some of them also resort to the merchant market for spot 
purchases of certain MMA derivatives.157 Nearly all downstream coating resins 
competitors engage in a multi -sourcing strategy, with many of them also making use 
of a wide array of traders to procure their requirements.158 The large majority of 
downstream competitors also purchase a variety of meth acrylate monomer types 
from the Target159, thus confirming the Notifying Party’s claim.  
(114)  The market investigation further indicates that a very large proportion of 
downstream competitors appear to manufacture multiple coating resin chemistries 
and for multip le end -uses.160 Only a single competitor reported producing only one 
type of resin chemistry (WB acrylics),161 which is one in which Allnex does not 
have any significant presence as a competitor.162 Contrary to the Parties’ claims, a 
majority of downstream compe titors stated that switching production lines to 
different coating resin chemistries and applications entails significant costs given the 
long and rigorous testing processes and the know -how required.163  
(115)  In terms of entry, the only significant newcomers int o the MMA derivative markets 
in the EEA over the past 5 years  were a number of producers with new production 
facilities outside of the EEA in Saudi Arabia (SABIC, Saudi Aramco), China, and 
Brazil (Unigel).164 In addition, Asian producers from China, Japan ( Sumitomo) and 
Korea (LG) are expected to expand into the EEA at some point in the future.165   
(116)  Lastly, a large majority of downstream competitors indicated that the Transaction 
would have no impact on their business.166 In the SB acrylics segment (regardless o f 
end-use application), where Allnex has larger market shares, the majority of 
downstream competitors stated that they did not expect the Transaction to bring 
about an increase in price, a drop in quality, or a reduction in customer choice.167  
Moreover, whe reas  a majority of coating resin manufacturers suggested that shifting 
sourcing volumes might prove excessively costly in the short -to-medium term,168 
these concerns related primarily to a hypothetical lack of availability in the EEA (i.e. 
due to temporary technical issues at the EEA -based suppliers’ manufacturing 
facilities) and not to the inability of a particular upstream manufacturer to supply 
their demand. In addition, the majority of downstream producers seems to expect 
that the market will remain long  and that no major availability issues will arise in the 
medium term.169  
                                                 
157  Responses to Q1 – Questionnaire to Competitors and Customers, questions 1 -3 and 20 . 
158  Responses to Q1 – Questionnaire to Competitors and Customers, question 18.  
159  Responses to Q1 – Questionnaire to Competitors and Customers, question 20.  
160  Responses to Q1 – Questionnaire to Competitors and Customers, question 28.  
161  Responses to Q1 – Questionnaire to Competitors and Customers, question 28.  
162  Responses to Q1 – Questionnaire to Competitors and Customers, question 34.  
163  Responses to Q1 – Questionnaire to Competitors and Customers, question 29.  
164  Responses to Q1 – Questionnaire to Competitors and Customers, questions 12 and 21.  
165  Responses t o Q1 – Questionnaire to Competitors and Customers, questions 13 and 22.  
166  Responses to Q1 – Questionnaire to Competitors and Customers, question 40.  
167  Responses to Q1 – Questionnaire to Competitors and Customers, question 38.  
168  Responses to Q1 – Quest ionnaire to Competitors and Customers, question 25.  
169  Responses to Q1 – Questionnaire to Competitors and Customers, question 25.  
30 (b) Input foreclosure MMA/coating resins  
(117)  According to the Notifying Party, the Target’s EEA market share in the MMA 
merchant market is [35-40]%, with the closest competitor Lucite having a  slightly 
higher [35-40]%, and the remaining [20 -25]% being held by a long tail of 
competitors ( Arkema ( [0-5]% - EU, US), Sumitomo ( [0-5]% - Japan, Singapore, 
Saudi Arabia), Unigel (<5 – Brazil, Mexico), Asahi (<5 % – Japan, Thailand), Jihua 
(<5% – China), Formosa Plastics (<5 % – Taiwan), Sailboat (<5 % – China), 
Shangdong Hongzu (<5 % – China), Anda Longzing (<5 % – China) and Kuraray 
(<5% – Japan) ),170 many of whom supply EEA customers via traders. The market 
investigation confirmed these market positions, and indicated that there appears to 
be indeed a long tail of suppliers and traders available to customers in the coating 
resins market.171 
(118)  Moreover, the results of the market investigation reveal that MMA is considered to 
be an essential component for some but n ot all of the resin chemistries, namely: 
SB/WB acrylics, WB polyurethane dispersions, radiation -curable  
monomers/oligomers/acrylates, and radiation -curable  UV-curable polyurethane 
dispersions .172 Conversely, the results of the market investigation also show that 
nearly all downstream coating resins competitors are active across multiple resin 
chemistries and industrial applications (including at least one category where MMA 
is an essential component).173 Consequently,174 any foreclosure attempt on the part 
of the  merged entity could turn into a profit -losing strategy as it would have to cover 
virtually the whole range of downstream competitors in order to have any effect on 
the merged entity’s own market position in the downstream markets for coating 
resins.     
(119)  In addition, the ability of the merged entity to foreclose access to key inputs with a 
view to improving its downstream position would be further constrained by the fact 
that a significant number of downstream competitors are integrated upstream as 
regards  the manufacture of MMA. Additionally, even when excluding these 
competitors from the analysis, in the extreme situation where the merged entity 
would completely stop selling MMA to Allnex’s competitors downstream, a 
conservative analysis of the results of  the market investigation reveals that there 
would be sufficient spare capacity in the upstream market to cover over 95% of the 
EEA demand previously supplied by the Target to Allnex’s competitors.175 In 
support of this view, a large majority of the surveyed  competitors expect that a 
sufficient number of alternative MMA suppliers with the required capacities will 
remain available in the market post -Transaction.176 As a result, it appears unlikely 
that the merged entity would have the ability to foreclose its do wnstream rivals.   
(120)  Likewise, it appears unlikely that the combined entity would have the incentives to 
engage in an input foreclosure strategy. This is notably because the market 
investigation has revealed that, on average, gross margins per tonne appear t o be 
equal or higher for MMA than for most coating resin chemistries for which MMA is 
                                                 
170  Based on the Notifying Party’s market share estimates.  
171  Responses to Q1 – Questionnaire to Competitors and Customers, q uestions 11 and 20.  
172  See Table  for further details.  
173  See section 5.2.4.2(a), paragraph (114) . 
174  Responses to Q1 – Questionnaire to Competitors and Customers, question 28.  
175  Responses to Q1 – Questionnaire to Competitors and Customers, question 5.  
176  Responses to Q1 – Questionnaire  to Competitors and Customers, question 39.1.  
31 considered to be an essential input,177 which would discourage the expansion of the 
merged entity’s position downstream at the expense of its upstream sales. Moreover, 
the market investigation has confirmed that most customers purchasing MMA from 
the Target also purchase other MMA derivatives,178 which supports the Notifying 
Party’s argument that customers could punish the merged entity by discontinuing 
purchases of other MMA derivatives in case of attempt to foreclose the supply of 
MMA.  
(121)  In view of the above considerations supported by evidence collected over the course 
of the market investigation, the Commission considers that, after the Transaction, the 
merged entity is not likely to have the ability and incentive to foreclose its 
downstream rivals’ access to MMA.  
(c) Input foreclosure GMAA/coating resins  
(122)  The results of the market investigation reveal that GMAA is considered to be an 
essential component for some but not all of the resin chemistries: SB/WB acrylics, 
WB polyurethane dispersions, radiation -curable  monomers/oligomers/acrylates, and 
radiation -curable  glass laminates.179 Conversely, the results of the market 
investigation also show that nearly all downstream competitors are active across 
multiple resin chemistries and end -use applications (including at least one category 
where GMAA is an essential c omponent).180 Consequently,181 any foreclosure 
attempt on the part of the merged entity could turn into a profit -losing strategy as it 
would have to cover virtually the whole range of downstream competitors  in order to 
have any effect on the merged entity’s ow n market position in the downstream 
markets for coating resins.  
(123)  In addition, the ability of the merged entity to foreclose their access to key inputs 
with a view to improving its downstream position would be further constrained by 
the fact that a signific ant amount of downstream competitors are integrated upstream 
as regards the manufacture of GMAA.  Even, if these competitors  were excluded  
from the analysis, the merged entity would still be unlikely to have the ability to 
foreclose its downstream rivals. The Target’s EEA market share  in the GMAA 
merchant market is [25-30]%, with the closest competitors being Lucite ( UK, [35-
40]%) and BASF ( Germany, [20-25]%), and with a small market share held by Dow 
(USA, [5-10]%) and other manufacturers and traders both f rom within and outside 
the EEA (7%) .182 Being one of three mid -to-large suppliers of GMAA in the EEA, 
the Target by itself is unlikely to have  decisive influence over the availability of 
GMAA in the EEA . Moreover, the vast majority  of downstream competitors  using 
GMAA  in their manufacturing process  expect that a sufficient number  of alternative  
GMAA  suppliers with the required capacities will remain available in the market 
post-Transaction .183 As a result,  it is unlikely that the merged entity  would have the 
ability to foreclose its downstream rivals  from access to necessary GMAA inputs .  
                                                 
177  Form CO, Annex 18, Tables 1 and 2, (“Margin Data”); the same question was posed in Q1 – 
Questionnaire to Competitors and Customers (questions 15 and 37) but the results were inconclusive.  
178  Responses to Q1  – Questionnaire to Competitors and Customers, question 20.  
179  See Table 5 for further details.  
180  See section 5.2.4.2(a), paragraph (114) . 
181  Responses to Q1 – Questionnaire to Competitors and Customers, question 28.  
182   Based on the Notifying Party’s market share estimates and confirmed with question 20.1 in Q1 - 
Questionnaire to Competitors and Customers.  
183  Responses to Q1 – Questionnaire t o Competitors and Customers, question 39.4.  
32 (124)  Likewise, it is unlikely that the merged entity would have the incentives to engage in 
an input foreclosure strategy. This is notably because the market investigation has 
revealed that, on average, gross margins per tonne appear to be higher for GMAA 
than for most coating resin chemistries  for which GMAA is considered to be an 
essential input .184 This would discourage the expansion of the merged entity’s 
position downstream at the expense of its upstream sales. Moreover, the market 
investigation has confirmed  that all customers purchasing GMAA from the Target 
surveyed also purchase other MMA derivatives from it,185 which supports the 
Notifying Party’s argument that customers could punish the merged entity by 
discontinuing purchases of other MMA derivatives in ca se of any attempt to 
foreclosure the supply of GMAA.  
(125)  In view of the above considerations supported by evidence collected during the 
market investigation, the Commission considers that, post Transaction, the merged 
entity is not likely to have the ability and incentive to foreclose its downstream 
rivals’ access to GMAA.   
(d) Input foreclosure HYMA/coating resins  
(126)  The results of the market investigation reveal that HYMA  is considered to be an 
essential component for two categories of resin chemistries, namely  SB and WB 
acrylics. 186 Given that HYMA is only deemed essential for a small share of coating 
resin chemistries, the merged entity’s  ability to foreclose its downstream rivals 
would be restricted to these two types of products and the overall impact of a 
hypot hetical foreclosure strategy would accordingly be very limited.    
(127)  According to the Notifying Party, the  Target’s EEA market share in the HYMA  
merchant market is [35-40]%, with the closest competitors being GEO  (UK, [30-
35]%) and Nippon Shokubai  (Japan, [20-25]%), and with small market shares held  
by Lucite (UK, [0 -5]%) and by  other manufacturers  and traders  both from within 
and outside the EEA ( 4%).187 In contrast, the market investigation suggested that 
GEO might instead be the largest supplier in the EEA.188 Being one of three mid -to-
large suppliers of HYMA  in the EEA, the Target by itself is unlikely to have 
decisive influence over the availability of HYMA  in the EEA.  Moreover, the ability 
of the merged entity to foreclose access to key inputs with a view to improving its 
downstream position would be further constrained by the fact that a significant 
number of downstream competitors are integrated upstream in the manufacture of 
HYMA.  In addition, the large majority of the surveyed  downstream competitors 
using  HYMA  expec t that a sufficient number  of alternative  HYMA  suppliers with 
the required capacities will remain  available  in the market post -Transaction .189 As a 
result , it appears unlikely that the merged entity  would have the ability to foreclose 
its downstre am rivals.  
(128)  Likewise, it appears unlikely that the merged entity would have the incentive to 
engage in an input foreclosure strategy in relation to HYMA.  This is notably 
because, o n average, gross margins per tonne appear to be  equal or  higher for 
                                                 
184   Form CO, Annex 18, Tables 1 and 2, (“Margin Data”); the same question was posed in Q1 – 
Questionnaire to Competitors and Customers (questions 15 and 37) but the results were inconclusive.  
185  Responses to Q1 – Questionnaire to Competitors and Customers, question 20.  
186  See Table 5 for further details.  
187  Based on the Notifying Party’s market share estimates.  
188  Responses to Q1 – Questionnaire to Competitors and Customers, questions 11 and 20.  
189  Responses to Q1 – Questionnaire to Competitors and Customers, question 39.2.  
33 HYMA  than for most coating resin chemistries for which HYMA is considered to be 
an essential input.190 This would discourage the expansion of the merged entity’s 
position downstream at the expense of its upstream sales. Additionally, the market 
investigation has conf irmed that  all customers purchasing HYMA  from the Target 
also purchase other MMA derivatives from it  (and generally in higher quantities) ,191 
which supports the Notifying Party’s argument that  customers could punish the 
merged entity  by discontinuing purchas es of other MMA derivatives in case of any 
attempt to foreclose the supply of HYMA .  
(129)  In view of the above considerations supported by evidence collected during the 
market investigation, the Commission considers that, post Transaction, the merged 
entity is not likely to  have the ability and the incentive to foreclose its downstream 
rivals’ access to HYMA.  
(e) Input foreclosure BUMA/coating resins  
(130)  The results of the market investigation reveal that BUMA is considered to be an 
essential component for some but not  all of the categories of resin chemistries: 
SB/WB acrylics, WB polyurethane dispersions, radiation -curable  
monomers/oligomers/acrylates, radiation -curable  UV-curable polyurethane 
dispersions, radiation -curable  glass laminates .192  Conversely, the results of  the 
market investigation also show that nearly all downstream competitors are active 
across multiple resin chemistries and end -use applications (including at least one 
category where BUMA is an essential component).193 Consequently,194 any 
foreclosure attempt  on the part of the merged entity could turn into a profit -losing 
strategy as it would have to cover virtually the whole range of downstream 
competitors  in order to have any effect on the merged entity’s own market position 
in the downstream markets for co ating resins.      
(131)  The Target’s EEA market shares in the BUMA  merchant market are [40-45]%, with 
the closest competitor  being Lucite ( UK, [35-40]%), and with small market shares 
held by Dow ( USA, [5-10]%) and other manufacturers both from within and outside 
the EEA ( 16%).195 Despite this market share, the ability of the merged entity to 
foreclose access to key inputs would be constrained by the fact that a significant 
number of downstream competitors are integrated upstream as regards  the 
manufacture of  BUMA. Moreover, the large majority of the surveyed downstream 
competitors expect that a sufficient number of alternative suppliers for BUMA with 
the required capacities will remain available post -Transaction.196 As a result , it 
appears unlikely that the merged entity  would have the ability to foreclose its 
downstream rivals.  
(132)  Likewise, it appears unlikely that the merged entity would have the incentive to 
engage in an input foreclosure strategy. This is notably because, o n average, gross 
margins per tonne app ear to be  higher for BUMA  than for the largest resin chemistry 
                                                 
190   Form CO, Annex 18, Tables 1 and 2, (“Margin Data”); the same question was posed in Q1 – 
Questionnaire to Competitors and Customers (questions 15 and 37) but the results were inconclusive.  
191  Responses to Q1 – Questionnaire to Competitors and Customers, question 20.  
192  See Table 5 for further details.  
193  See section 5.2.4.2(a), paragraph (114) . 
194  Resp onses to Q1 – Questionnaire to Competitors and Customers, question 28.  
195  Based on the Notifying Party’s market shares and confirmed by question 20.2 in Q1 – Questionnaire 
to Competitors and Customers.  
196  Responses to Q1 – Questionnaire to Competitors and Customers, question 39.2.  
34 markets for which BUMA is considered to be an essential input,197 which would 
discourage the expansion of the merged entity’s position downstream at the expense 
of its upstream sales. Additionall y, the market investigation has confirmed that  all 
customers purchasing BUMA  from the Target also purchase other MMA derivatives 
from it  (and generally in higher quantities) ,198 which supports the Notifying Party’s 
argument that  customers could punish the merged entity  by discontinuing purchases 
of other MMA derivatives in case of attempt to foreclose the supply of BUMA.  
(133)  In view of the above considerations supported by evidence collected over during the 
market investigation, the Commission concludes that, pos t Transaction, the merged 
entity is not likely to have the ability and incentive to foreclose its downstream 
rivals’ access to BUMA.  
(f)  Input foreclosure methacrylamide/coating resins  
(134)  The results of the market investigation reveal that methacrylamide  is not considered 
to be an essential component for any of the categories of resin chemistries .199 In 
particular, the vast majority of downstream competitors indicated that they could 
replace methacrylamide without incurring significant costs.200 Hence, there appears 
to be very limited ability to engage into a foreclosure strategy in relation to 
methacrylamide. Moreover, the small minority of surveyed competitors who 
indicated that switching could entail significant costs are active in markets where 
Allnex does not hav e a strong presence (e.g. in WB acrylics, where Allnex has a 0 -
5% market share, or in WB PUDs, where Allnex has a 10 -15% market share),201 
thereby casting doubt on the merged entity’s incentive to engage in any foreclosure 
strategy vis -à-vis these competitor s.  
(135)  In addition, a s a significant amount of downstream competitors are integrated 
upstream in the manufacture of MMA derivatives , including methacrylamide , the 
merged entity  would in any event be deprived of  the ability to foreclose their access 
to key inputs.  Overall, only a small minority of downstream competitors consider 
that they could face a shortage of methacrylamide in the EEA post -Transaction,202 
and that shortage is unlikely to originate from the cond uct of the merged entity.203  
(136)  In view of the above considerations supported by evidence collected during the 
market investigation, the Commission concludes that, after the Transaction, the 
merged entity is not likely to have the ability and incentive to fore close its 
downstream rivals’ access to methacrylamide.  
5.2.5.   Conclusion  
(137)  Taking into consideration the assessments carried out in sections 5.2.2 to 5.2.4 
above, it appears unlikely that the merged entity would have the ability and the 
                                                 
197   Form CO, Annex 18, Tables 1 and 2, (“Margin Data”); the same question was posed in Q1 – 
Questionnaire to Competitors and Customers (questions 15 and 37) but the results were inconclusive.  
198  Responses to Q1 – Questionnaire to Competitors and Customers, question 20.  
199  See Table 5 – Essential and non -essential MMA and MMA derivatives for coating resins  
. 
200   Responses to Q1 – Questionnaire to Competitors and Customers, question 30 . 
201  Responses to Q1 – Questionnaire to Competitors and Customers, question 30.  
202  Responses to Q1 – Questionnaire to Competitors and Customers, question 39.5.  
203   Shortages of methacrylamide could instead theoretically arise due to non -merger -specific 
circumstances, for instance a widespread shortage in the inputs to MMA, resulting in a subsequent 
tightening of the MMA derivatives m arket.  
35 incentive to foreclose its  competitors in the upstream markets for MMA and MMA 
derivatives from their access to an important customer  or to foreclose its  rivals in the 
downstream markets for coating resins from their access to key inputs (MMA and 
MMA derivatives).  
6. CONCLUSION  
(138)  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 Regul ation and Article 57 of the EEA Agreement . 
For the Commission  
 
 
(Signed)  
Margrethe VESTAGER  
Member of the Commission