Carlyle Partners IV, L.P.; Analysis of Agreement Containing Consent Order to Aid Public Comment, 38453-38455 [E8-15208]
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Federal Register / Vol. 73, No. 130 / Monday, July 7, 2008 / Notices
annual disclosure burden for new
business opportunity sellers will be
approximately 7,500 hours. Staff further
estimates that the remaining 2,250
established business opportunity sellers
will require no more than
approximately 3 hours each to update
their disclosure document. Accordingly,
staff estimates that the cumulative
annual disclosure burden for
established business opportunity sellers
will be approximately 6,750 hours.
Business opportunity sellers may
need to maintain additional
documentation for the sale of business
opportunities in states not currently
requiring these records as part of their
regulation of business opportunity
sellers. This could take up to an
additional hour of recordkeeping per
year. Accordingly, staff estimates that
business opportunity sellers will
cumulatively incur approximately 2,500
hours of recordkeeping burden each
year (2,500 business opportunity sellers
x 1 hour).
Thus, the total burden for business
opportunity sellers is approximately
16,750 hours (7,500 hours of disclosure
burden for new business opportunity
sellers + 6,750 hours of disclosure
burden for established business
opportunity sellers + 2,500 of
recordkeeping burden for all business
opportunity sellers).
mstockstill on PROD1PC66 with NOTICES
Estimated annual labor cost: $3,595,000
Labor costs are determined by
applying applicable wage rates to
associated burden hours. Staff presumes
an attorney will prepare or update the
disclosure document at an estimated
$250 per hour. As applied, this would
yield approximately $3,562,500 in labor
costs attributable to compliance with
the Rule’s disclosure requirements ((250
new business opportunity sellers x $250
per hour x 30 hours per seller) + (2,250
established business opportunity sellers
x $250 per hour x 3 hours per seller)).
Staff anticipates that recordkeeping
would be performed by clerical staff at
approximately $13 per hour. At 2,500
hours per year for all affected business
opportunity sellers (see above), this
would amount to a total cost of $32,500.
Thus, the combined labor costs for
recordkeeping and disclosure for
business opportunity sellers is
approximately $3,595,000.
Estimated non-labor cost: $3,887,500
Business opportunity sellers must
also incur costs to print and distribute
the disclosure document. These costs
vary based upon the length of the
disclosures and the number of copies
produced to meet the expected demand.
Staff estimates that 2,500 business
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19:10 Jul 03, 2008
Jkt 214001
opportunity sellers print and mail 100
documents per year at a cost of $15 per
document, for a total cost of $3,750,000
(2,500 business opportunity sellers x
100 documents per year x $15 per
document).
Business opportunity sellers must
also complete and disseminate an FTCrequired cover sheet that identifies the
business opportunity seller, the date the
document is issued, a table of contents,
and a notice that tracks the language
specifically provided in the Rule.
Although some of the language in the
cover sheet is supplied by the
government for the purpose of
disclosure to the public, and is thus
excluded from the definition of
‘‘collection of information’’ under the
PRA, see 5 CFR 1320.3(c)(2), there are
residual costs to print and mail these
cover sheets, including within them the
presentation of related information
beyond the supplied text. Staff estimates
that 2,500 business opportunity sellers
complete and disseminate 100 cover
sheets per year at a cost of
approximately $0.55 per cover sheet, or
a total cost of approximately $137,500
(2,500 business opportunity sellers x
100 cover sheets per year x $0.55 per
cover sheet).
Accordingly, the cumulative nonlabor cost incurred by business
opportunity sellers each year
attributable to compliance will be
approximately $3,887,500 ($3,750,000
for printing and mailing documents +
$137,500 for completing and mailing
cover sheets).
William Blumenthal,
General Counsel.
[FR Doc. E8–15143 Filed 7–3–08: 8:45 am]
BILLING CODE 6750–01–S
FEDERAL TRADE COMMISSION
[File No. 071 0203]
Carlyle Partners IV, L.P.; Analysis of
Agreement Containing Consent Order
to Aid Public Comment
Federal Trade Commission.
Proposed Consent Agreement.
AGENCY:
ACTION:
SUMMARY: The consent agreement in this
matter settles alleged violations of
federal law prohibiting unfair or
deceptive acts or practices or unfair
methods of competition. The attached
Analysis to Aid Public Comment
describes both the allegations in the
draft complaint and the terms of the
consent order — embodied in the
consent agreement — that would settle
these allegations.
PO 00000
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Fmt 4703
Sfmt 4703
38453
Comments must be received on
or before July 29, 2008.
ADDRESSES: Interested parties are
invited to submit written comments.
Comments should refer to ‘‘Carlyle
Partners, File No. 071 0203,’’ to
facilitate the organization of comments.
A comment filed in paper form should
include this reference both in the text
and on the envelope, and should be
mailed or delivered to the following
address: Federal Trade Commission/
Office of the Secretary, Room 135-H,
600 Pennsylvania Avenue, NW.,
Washington, DC 20580. Comments
containing confidential material must be
filed in paper form, must be clearly
labeled ‘‘Confidential,’’ and must
comply with Commission Rule 4.9(c).
16 CFR 4.9(c) (2005).1 The FTC is
requesting that any comment filed in
paper form be sent by courier or
overnight service, if possible, because
U.S. postal mail in the Washington area
and at the Commission is subject to
delay due to heightened security
precautions. Comments that do not
contain any nonpublic information may
instead be filed in electronic form by
following the instructions on the webbased form at (https://
secure.commentworks.com/ftcCarlylePartners). To ensure that the
Commission considers an electronic
comment, you must file it on that webbased form.
The FTC Act and other laws the
Commission administers permit the
collection of public comments to
consider and use in this proceeding as
appropriate. All timely and responsive
public comments, whether filed in
paper or electronic form, will be
considered by the Commission, and will
be available to the public on the FTC
website, to the extent practicable, at
www.ftc.gov. As a matter of discretion,
the FTC makes every effort to remove
home contact information for
individuals from the public comments it
receives before placing those comments
on the FTC website. More information,
including routine uses permitted by the
Privacy Act, may be found in the FTC’s
privacy policy, at (https://www.ftc.gov/
ftc/privacy.htm).
FOR FURTHER INFORMATION CONTACT:
Catherine M. Moscatelli, FTC Bureau of
Competition, 600 Pennsylvania Avenue,
DATES:
1 The comment must be accompanied by an
explicit request for confidential treatment,
including the factual and legal basis for the request,
and must identify the specific portions of the
comment to be withheld from the public record.
The request will be granted or denied by the
Commission’s General Counsel, consistent with
applicable law and the public interest. See
Commission Rule 4.9(c), 16 CFR 4.9(c).
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Federal Register / Vol. 73, No. 130 / Monday, July 7, 2008 / Notices
NW., Washington, DC 20580, (202) 3262749.
SUPPLEMENTARY INFORMATION: Pursuant
to section 6(f) of the Federal Trade
Commission Act, 38 Stat. 721, 15 U.S.C.
46(f), and § 2.34 of the Commission
Rules of Practice, 16 CFR 2.34, notice is
hereby given that the above-captioned
consent agreement containing a consent
order to cease and desist, having been
filed with and accepted, subject to final
approval, by the Commission, has been
placed on the public record for a period
of thirty (30) days. The following
Analysis to Aid Public Comment
describes the terms of the consent
agreement, and the allegations in the
complaint. An electronic copy of the
full text of the consent agreement
package can be obtained from the FTC
Home Page (for June 30, 2008), on the
World Wide Web, at (https://
www.ftc.gov/os/2008/06/index.htm). A
paper copy can be obtained from the
FTC Public Reference Room, Room 130H, 600 Pennsylvania Avenue, NW.,
Washington, DC 20580, either in person
or by calling (202) 326-2222.
Public comments are invited, and may
be filed with the Commission in either
paper or electronic form. All comments
should be filed as prescribed in the
ADDRESSES section above, and must be
received on or before the date specified
in the DATES section.
mstockstill on PROD1PC66 with NOTICES
Analysis of Agreement Containing
Consent Order to Aid Public Comment
I. Introduction
The Federal Trade Commission
(‘‘Commission’’) has accepted, subject to
final approval, an Agreement
Containing Consent Order from Carlyle
Partners IV, L.P. (‘‘Respondent’’). The
Consent Agreement is intended to
resolve anticompetitive effects
stemming from Carlyle’s proposed
acquisition of the world-wide sodium
silicate and silicas business from INEOS
Group Limited (‘‘INEOS’’). Carlyle
participates in the sodium silicate
market world-wide through PQ
Corporation, which it owns. PQ is the
largest producer of sodium silicate in
the United States. The Consent
Agreement includes a proposed
Decision and Order which requires
Respondent to divest PQ’s sodium
silicate plant and business located in
Utica, Illinois. The proposed Decision
and Order also requires the licensing of
all intellectual property related to the
production of sodium silicate at the
Utica plant.
The Decision and Order calls for
divestiture of PQ’s Utica, Illinois plant
to Oak Hill Acquisition Company, LLC
(‘‘Oak Hill’’), or another Commission-
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17:39 Jul 03, 2008
Jkt 214001
approved buyer in the event that Oak
Hill is determined not to be acceptable.
The Consent Agreement, if finally
accepted by the Commission, would
settle charges that the proposed
acquisition may substantially lessen
competition in the market for sodium
silicate in the Midwest United States.
The Commission has reason to believe
that Respondent’s proposed acquisition
would violate Section 7 of the Clayton
Act, as amended, 15 U.S.C. § 18, and
Section 5 of the Federal Trade
Commission Act, as amended, 15 U.S.C.
§ 45.
II. The Proposed Complaint
According to the Commission’s
proposed complaint, the relevant
product market in which to analyze the
effects of INEOS’ sale of assets to Carlyle
is the market for the sale and
manufacture of sodium silicate. Sodium
silicate has a variety of direct uses and
is also consumed in the production of
downstream silicate derivatives, also
referred to as silicas. According to the
Commission’s complaint, sodium
silicate does not, in its various end-uses,
have close substitutes that constrain its
pricing. The relevant geographic market
is the Midwest United States. Sodium
silicate, which is generally sold in an
aqueous solution form that is 65%
water, exhibits strong regional markets
because of high transportation costs
relative to the value of the product.
The proposed complaint alleges that
the market for sodium silicate is highly
concentrated and that the acquisition
reduces the number of competitors in
the Midwest United States market from
four to three. According to the proposed
complaint, the acquisition combines PQ,
the largest competitor, with INEOS, the
third largest competitor, which hold
50% and 12% market shares as
measured by plant capacity,
respectively. The HHI in this market
would increase by 1181, to 4674.
The proposed complaint alleges that
the proposed acquisition would reduce
competition by eliminating direct
competition between these two
companies. The proposed complaint
further states that the market for sodium
silicate is conducive to coordination
due to several structural features,
including the facts that sodium silicate
is a homogenous product and pricing
information is readily available.
Furthermore, evidence suggests that
competitors behave as if the market
were essentially a duopoly in which the
top two producers, PQ and Occidental,
operate with a high level of mutual
interdependence. Based on the level of
concentration and the competitive
conditions, the Commission’s complaint
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Frm 00066
Fmt 4703
Sfmt 4703
alleges that the acquisition would make
coordinated interaction more likely,
leading to higher prices for sodium
silicate. The proposed complaint further
alleges that entry into the relevant
market would not be timely, likely, or
sufficient to deter or offset the proposed
acquisition’s adverse competitive
effects.
III. Terms of the Proposed Order
Under the proposed Decision and
Order, Carlyle will divest its Utica,
Illinois sodium silicate business to Oak
Hill within five (5) days of the INEOS
acquisition. Oak Hill is a new entity that
has been created for the purpose of
acquiring the Utica plant. The principal
owner of Oak Hill has been involved in
entrepreneurial investments in a
number of industries over the past
twenty five years, including in the
chemicals, software,
telecommunications, construction, real
estate, and energy industries.
The consent order has several major
operative provisions. Section II.A. of the
Order requires PQ to divest the Utica
plant to an up-front purchaser, Oak Hill
Acquisition Company, LLC, in
accordance with the provisions of the
Asset Purchase Agreement, within five
days of consummating the acquisition of
INEOS. Section II.A. also gives the
Commission the authority to require PQ
to divest the Utica plant to another
purchaser, should the Commission
deem Oak Hill not to be acceptable; and
to direct PQ to accept any remedial
provisions it may add to the Order after
initial acceptance. Section II.D. requires
Respondents to make available to Oak
Hill or other purchaser, at no greater
than direct cost, such personnel,
assistance and training as is necessary to
enable the purchaser to operate the
Utica plant in substantially the same
manner as PQ operated plant, for a
period of two years after divestiture.
Section II.E. requires Respondents to
enter into an employee services
agreement covering certain union
employees at the Utica plant to facilitate
their continued employment at that the
plant under the new ownership. Section
III.A. allows the Commission to appoint
an Interim Monitor to assure that
Respondents expeditiously comply with
all of their obligations and perform all
of their responsibilities. Section IV.A.
allows the Commission to appoint a
Divestiture Trustee should PQ fail to
fully comply with the obligations to
assign, grant, license, divest, transfer,
deliver or otherwise convey assets
required by the Order. Section V.B.
requires Respondents to submit to the
Commission a verified written report
setting forth in detail the manner and
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38455
Federal Register / Vol. 73, No. 130 / Monday, July 7, 2008 / Notices
form in which they intend to comply,
are complying, and have complied with
the Order, on a regular basis until
Respondents have fully achieved the
divestiture. Section VII requires
Respondents to notify the Commission
of any change in their corporate
structure that may affect compliance
obligations arising out of the Order.
Pursuant to Section IX, the Order has a
ten year term.
IV. Opportunity for Public Comment
The proposed Decision and Order has
been placed on the public record for
thirty (30) days to receive comments by
interested persons. Comments received
during this period will become part of
the public record. After thirty (30) days,
the Commission will review the Consent
Agreement and comments received and
decide whether to withdraw its
agreement or make final the Consent
Agreement’s proposed Order.
Trans. No.
The purpose of this analysis is to
facilitate public comment on the
proposed Decision and Order. This
analysis is not intended to constitute an
official interpretation of the Consent
Agreement and the proposed Decision
and Order.
By direction of the Commission.
Richard C. Donohue,
Acting Secretary.
[FR Doc. E8–15208 Filed 7–3–08: 8:45 am]
BILLING CODE 6750–01–S
FEDERAL TRADE COMMISSION
Granting of Request for Early
Termination of the Waiting Period
Under the Premerger Notification
Rules
Section 7A of the Clayton Act, 15
U.S.C. 18a, as added by Title II of the
Hart-Scott Rodino Antitrust
Acquiring
Improvements Act of 1976, requires
persons contemplating certain mergers
or acquisitions to give the Federal Trade
Commission and the Assistant Attorney
General advance notice and to wait
designated periods before
consummation of such plans. Section
7A(b)(2) of the Act permits the agencies,
in individual cases, to terminate this
waiting period prior to its expiration
and requires that notice of this action be
published in the Federal Register.
The following transactions were
granted early termination of the waiting
period provided by law and the
premerger notification rules. The grants
were made by the Federal Trade
Commission and the Assistant Attorney
General for the Antitrust Division of the
Department of Justice. Neither agency
intends to take any action with respect
to these proposed acquisitions during
the applicable waiting period.
Acquired
Entities
Transactions Granted Early Termination—04/22/2008
20080908
20080988
20081004
20081010
20081012
20081016
20081018
...........
...........
...........
...........
...........
...........
...........
20081031
20081032
20081035
20081047
...........
...........
...........
...........
Nufarm Limited .......................................
William Davidson ...................................
Carlisle Companies Incorporated ..........
Platinum Equity Capital Partners II, L.P
The Procter & Gamble Company ..........
Tata Motors Limited ...............................
Ospraie Special Opportunities (Offshore) Ltd.
The Walt Disney Company ....................
Luxco ......................................................
SUEZ ......................................................
EMC Corporation ...................................
Stephens Gro-Pro LLC ..........................
Robert Family Holdings, Inc ..................
Carol-Ann O’Mack ..................................
Industrial Distribution Group, Inc ...........
Frederic, LLC .........................................
Ford Motor Company .............................
ConAgra Foods, Inc ...............................
Gro-Pro, LLC.
Siegel-Robert, Inc.
Carlyle Holdings, Inc.
Industrial Distribution Group, Inc.
Frederic, LLC.
Jaguar and Land Rover
Freebird II, LLC; Freebird I, LLC.
The Children’s Place Retail Stores, Inc
Citigroup Inc ...........................................
Carl S. Cummings, Sr ............................
Iomega Corporation ...............................
Hoop Retail Stores, LLC; Traxi LLC.
GST AutoLeather, Inc.
USG GA, LLC.
Iomega Corporation.
Transactions Granted Early Termination—04/23/2008
20081023 ...........
Honeywell International Inc ....................
Odyssey Investment Partners Fund III,
LP.
Safety Products Holdings, Inc.
Transactions Granted Early Termination—04/25/2008
20081017 ...........
20081034 ...........
Participacoes Morro Vermelho S.A .......
Lindsay Goldberg & Bessemer II L.P ....
Texas Industries Inc ...............................
Remedial Construction Services, L.P ....
Texas Industries Inc.
Remedial Construction Services, L.P.
Transactions Granted Early Termination—04/28/2008
Honeywell International Inc ....................
New York University ..............................
Catholic Health East ..............................
Peny J. Schmidt .....................................
Polytechnic University ............................
Cathedral Healthcare System, Inc .........
20081046 ...........
20081054 ...........
JP Morgan Chase & Co .........................
Richard L. Duchossois ...........................
20081058 ...........
20081061 ...........
mstockstill on PROD1PC66 with NOTICES
20081000 ...........
20081041 ...........
20081045 ...........
Lindsay Goldberg & Bessemer II, L.P ...
Takeda Pharmaceutical Company Limited.
TZ Holdings, L.P ....................................
Dayton-Cox Trust A ...............................
J.P. Morgan Chase & Co .......................
Bahram Akradi .......................................
Clipper Windpower Plc ..........................
Friedman Fleischer & Lowe Capital
Partners, L.P.
Dr. James R. Leininger ..........................
Millennium Pharmaceuticals, Inc ...........
20081065
20081069
20081070
20081073
...........
...........
...........
...........
The TriZetto Group, Inc .........................
Adify Corporation ...................................
Markit Group Holdings Limited ..............
Life Time Fitness, Inc ............................
Energy Services Group, LLC.
Polytechnic University.
Cathedral Health Services, Inc.; Columbus Hospital.
Clipper Windpower Plc.
Milestone Technologies AV, Inc.
Ambulatory Services of America, Inc.
Millennium Pharmaceuticals, Inc.
The TriZetto Group, Inc.
Adify Corporation.
Markit Group Holdings Limited.
Life Time Fitness, Inc.
Transactions Granted Early Termination—04/29/2008
20081068 ...........
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Kinetic Concepts, Inc .............................
18:42 Jul 03, 2008
Jkt 214001
PO 00000
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LifeCell Corporation ...............................
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E:\FR\FM\07JYN1.SGM
LifeCell Corporation.
07JYN1
Agencies
[Federal Register Volume 73, Number 130 (Monday, July 7, 2008)]
[Notices]
[Pages 38453-38455]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E8-15208]
-----------------------------------------------------------------------
FEDERAL TRADE COMMISSION
[File No. 071 0203]
Carlyle Partners IV, L.P.; Analysis of Agreement Containing
Consent Order to Aid Public Comment
AGENCY: Federal Trade Commission.
ACTION: Proposed Consent Agreement.
-----------------------------------------------------------------------
SUMMARY: The consent agreement in this matter settles alleged
violations of federal law prohibiting unfair or deceptive acts or
practices or unfair methods of competition. The attached Analysis to
Aid Public Comment describes both the allegations in the draft
complaint and the terms of the consent order -- embodied in the consent
agreement -- that would settle these allegations.
DATES: Comments must be received on or before July 29, 2008.
ADDRESSES: Interested parties are invited to submit written comments.
Comments should refer to ``Carlyle Partners, File No. 071 0203,'' to
facilitate the organization of comments. A comment filed in paper form
should include this reference both in the text and on the envelope, and
should be mailed or delivered to the following address: Federal Trade
Commission/Office of the Secretary, Room 135-H, 600 Pennsylvania
Avenue, NW., Washington, DC 20580. Comments containing confidential
material must be filed in paper form, must be clearly labeled
``Confidential,'' and must comply with Commission Rule 4.9(c). 16 CFR
4.9(c) (2005).\1\ The FTC is requesting that any comment filed in paper
form be sent by courier or overnight service, if possible, because U.S.
postal mail in the Washington area and at the Commission is subject to
delay due to heightened security precautions. Comments that do not
contain any nonpublic information may instead be filed in electronic
form by following the instructions on the web-based form at (https://
secure.commentworks.com/ftc-CarlylePartners). To ensure that the
Commission considers an electronic comment, you must file it on that
web-based form.
---------------------------------------------------------------------------
\1\ The comment must be accompanied by an explicit request for
confidential treatment, including the factual and legal basis for
the request, and must identify the specific portions of the comment
to be withheld from the public record. The request will be granted
or denied by the Commission's General Counsel, consistent with
applicable law and the public interest. See Commission Rule 4.9(c),
16 CFR 4.9(c).
---------------------------------------------------------------------------
The FTC Act and other laws the Commission administers permit the
collection of public comments to consider and use in this proceeding as
appropriate. All timely and responsive public comments, whether filed
in paper or electronic form, will be considered by the Commission, and
will be available to the public on the FTC website, to the extent
practicable, at www.ftc.gov. As a matter of discretion, the FTC makes
every effort to remove home contact information for individuals from
the public comments it receives before placing those comments on the
FTC website. More information, including routine uses permitted by the
Privacy Act, may be found in the FTC's privacy policy, at (https://
www.ftc.gov/ftc/privacy.htm).
FOR FURTHER INFORMATION CONTACT: Catherine M. Moscatelli, FTC Bureau of
Competition, 600 Pennsylvania Avenue,
[[Page 38454]]
NW., Washington, DC 20580, (202) 326-2749.
SUPPLEMENTARY INFORMATION: Pursuant to section 6(f) of the Federal
Trade Commission Act, 38 Stat. 721, 15 U.S.C. 46(f), and Sec. 2.34 of
the Commission Rules of Practice, 16 CFR 2.34, notice is hereby given
that the above-captioned consent agreement containing a consent order
to cease and desist, having been filed with and accepted, subject to
final approval, by the Commission, has been placed on the public record
for a period of thirty (30) days. The following Analysis to Aid Public
Comment describes the terms of the consent agreement, and the
allegations in the complaint. An electronic copy of the full text of
the consent agreement package can be obtained from the FTC Home Page
(for June 30, 2008), on the World Wide Web, at (https://www.ftc.gov/os/
2008/06/index.htm). A paper copy can be obtained from the FTC Public
Reference Room, Room 130-H, 600 Pennsylvania Avenue, NW., Washington,
DC 20580, either in person or by calling (202) 326-2222.
Public comments are invited, and may be filed with the Commission
in either paper or electronic form. All comments should be filed as
prescribed in the ADDRESSES section above, and must be received on or
before the date specified in the DATES section.
Analysis of Agreement Containing Consent Order to Aid Public Comment
I. Introduction
The Federal Trade Commission (``Commission'') has accepted, subject
to final approval, an Agreement Containing Consent Order from Carlyle
Partners IV, L.P. (``Respondent''). The Consent Agreement is intended
to resolve anticompetitive effects stemming from Carlyle's proposed
acquisition of the world-wide sodium silicate and silicas business from
INEOS Group Limited (``INEOS''). Carlyle participates in the sodium
silicate market world-wide through PQ Corporation, which it owns. PQ is
the largest producer of sodium silicate in the United States. The
Consent Agreement includes a proposed Decision and Order which requires
Respondent to divest PQ's sodium silicate plant and business located in
Utica, Illinois. The proposed Decision and Order also requires the
licensing of all intellectual property related to the production of
sodium silicate at the Utica plant.
The Decision and Order calls for divestiture of PQ's Utica,
Illinois plant to Oak Hill Acquisition Company, LLC (``Oak Hill''), or
another Commission-approved buyer in the event that Oak Hill is
determined not to be acceptable. The Consent Agreement, if finally
accepted by the Commission, would settle charges that the proposed
acquisition may substantially lessen competition in the market for
sodium silicate in the Midwest United States. The Commission has reason
to believe that Respondent's proposed acquisition would violate Section
7 of the Clayton Act, as amended, 15 U.S.C. Sec. 18, and Section 5 of
the Federal Trade Commission Act, as amended, 15 U.S.C. Sec. 45.
II. The Proposed Complaint
According to the Commission's proposed complaint, the relevant
product market in which to analyze the effects of INEOS' sale of assets
to Carlyle is the market for the sale and manufacture of sodium
silicate. Sodium silicate has a variety of direct uses and is also
consumed in the production of downstream silicate derivatives, also
referred to as silicas. According to the Commission's complaint, sodium
silicate does not, in its various end-uses, have close substitutes that
constrain its pricing. The relevant geographic market is the Midwest
United States. Sodium silicate, which is generally sold in an aqueous
solution form that is 65% water, exhibits strong regional markets
because of high transportation costs relative to the value of the
product.
The proposed complaint alleges that the market for sodium silicate
is highly concentrated and that the acquisition reduces the number of
competitors in the Midwest United States market from four to three.
According to the proposed complaint, the acquisition combines PQ, the
largest competitor, with INEOS, the third largest competitor, which
hold 50% and 12% market shares as measured by plant capacity,
respectively. The HHI in this market would increase by 1181, to 4674.
The proposed complaint alleges that the proposed acquisition would
reduce competition by eliminating direct competition between these two
companies. The proposed complaint further states that the market for
sodium silicate is conducive to coordination due to several structural
features, including the facts that sodium silicate is a homogenous
product and pricing information is readily available. Furthermore,
evidence suggests that competitors behave as if the market were
essentially a duopoly in which the top two producers, PQ and
Occidental, operate with a high level of mutual interdependence. Based
on the level of concentration and the competitive conditions, the
Commission's complaint alleges that the acquisition would make
coordinated interaction more likely, leading to higher prices for
sodium silicate. The proposed complaint further alleges that entry into
the relevant market would not be timely, likely, or sufficient to deter
or offset the proposed acquisition's adverse competitive effects.
III. Terms of the Proposed Order
Under the proposed Decision and Order, Carlyle will divest its
Utica, Illinois sodium silicate business to Oak Hill within five (5)
days of the INEOS acquisition. Oak Hill is a new entity that has been
created for the purpose of acquiring the Utica plant. The principal
owner of Oak Hill has been involved in entrepreneurial investments in a
number of industries over the past twenty five years, including in the
chemicals, software, telecommunications, construction, real estate, and
energy industries.
The consent order has several major operative provisions. Section
II.A. of the Order requires PQ to divest the Utica plant to an up-front
purchaser, Oak Hill Acquisition Company, LLC, in accordance with the
provisions of the Asset Purchase Agreement, within five days of
consummating the acquisition of INEOS. Section II.A. also gives the
Commission the authority to require PQ to divest the Utica plant to
another purchaser, should the Commission deem Oak Hill not to be
acceptable; and to direct PQ to accept any remedial provisions it may
add to the Order after initial acceptance. Section II.D. requires
Respondents to make available to Oak Hill or other purchaser, at no
greater than direct cost, such personnel, assistance and training as is
necessary to enable the purchaser to operate the Utica plant in
substantially the same manner as PQ operated plant, for a period of two
years after divestiture. Section II.E. requires Respondents to enter
into an employee services agreement covering certain union employees at
the Utica plant to facilitate their continued employment at that the
plant under the new ownership. Section III.A. allows the Commission to
appoint an Interim Monitor to assure that Respondents expeditiously
comply with all of their obligations and perform all of their
responsibilities. Section IV.A. allows the Commission to appoint a
Divestiture Trustee should PQ fail to fully comply with the obligations
to assign, grant, license, divest, transfer, deliver or otherwise
convey assets required by the Order. Section V.B. requires Respondents
to submit to the Commission a verified written report setting forth in
detail the manner and
[[Page 38455]]
form in which they intend to comply, are complying, and have complied
with the Order, on a regular basis until Respondents have fully
achieved the divestiture. Section VII requires Respondents to notify
the Commission of any change in their corporate structure that may
affect compliance obligations arising out of the Order. Pursuant to
Section IX, the Order has a ten year term.
IV. Opportunity for Public Comment
The proposed Decision and Order has been placed on the public
record for thirty (30) days to receive comments by interested persons.
Comments received during this period will become part of the public
record. After thirty (30) days, the Commission will review the Consent
Agreement and comments received and decide whether to withdraw its
agreement or make final the Consent Agreement's proposed Order.
The purpose of this analysis is to facilitate public comment on the
proposed Decision and Order. This analysis is not intended to
constitute an official interpretation of the Consent Agreement and the
proposed Decision and Order.
By direction of the Commission.
Richard C. Donohue,
Acting Secretary.
[FR Doc. E8-15208 Filed 7-3-08: 8:45 am]
BILLING CODE 6750-01-S