Dow Chemical Company; Analysis of Agreement Containing Consent Orders to Aid Public Comment, 5656-5658 [E9-2081]
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5656
Federal Register / Vol. 74, No. 19 / Friday, January 30, 2009 / Notices
Reich (Director, Office of Thrift
Supervision), and Chairman Sheila C.
Bair, that Corporation business required
its consideration of the matters on less
than seven days’ notice to the public;
and that no earlier notice of the meeting
than that previously provided on
January 22, 2009, was practicable.
The meeting was held in the Board
Room of the FDIC Building located at
550 17th Street, NW., Washington, DC.
Dated: January 27, 2009.
Federal Deposit Insurance Corporation.
Robert E. Feldman,
Executive Secretary.
[FR Doc. E9–2059 Filed 1–29–09; 8:45 am]
BILLING CODE 6714–01–P
FEDERAL RESERVE SYSTEM
mstockstill on PROD1PC66 with NOTICES
Formations of, Acquisitions by, and
Mergers of Bank Holding Companies
The companies listed in this notice
have applied to the Board for approval,
pursuant to the Bank Holding Company
Act of 1956 (12 U.S.C. 1841 et seq.)
(BHC Act), Regulation Y (12 CFR Part
225), and all other applicable statutes
and regulations to become a bank
holding company and/or to acquire the
assets or the ownership of, control of, or
the power to vote shares of a bank or
bank holding company and all of the
banks and nonbanking companies
owned by the bank holding company,
including the companies listed below.
The applications listed below, as well
as other related filings required by the
Board, are available for immediate
inspection at the Federal Reserve Bank
indicated. The applications also will be
available for inspection at the offices of
the Board of Governors. Interested
persons may express their views in
writing on the standards enumerated in
the BHC Act (12 U.S.C. 1842(c)). If the
proposal also involves the acquisition of
a nonbanking company, the review also
includes whether the acquisition of the
nonbanking company complies with the
standards in section 4 of the BHC Act
(12 U.S.C. 1843). Unless otherwise
noted, nonbanking activities will be
conducted throughout the United States.
Additional information on all bank
holding companies may be obtained
from the National Information Center
website at www.ffiec.gov/nic/.
Unless otherwise noted, comments
regarding each of these applications
must be received at the Reserve Bank
indicated or the offices of the Board of
Governors not later than February 26,
2009.
A. Federal Reserve Bank of New
York (Ivan Hurwitz, Bank Applications
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16:54 Jan 29, 2009
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Officer) 33 Liberty Street, New York,
New York 10045–0001:
1. Allied Irish Banks, p.l.c., Dublin,
Ireland, M&T Bank Corporation, and
First Empire State Holding Company, all
of Buffalo, New York, to acquire
Provident Bankshares Corporation,
Baltimore, Maryland, and merge
Provident Bankshares Corporation with
and into First Empire State Holding
Company, and thereby indirectly
acquire Provident Bank of Maryland,
Baltimore, Maryland.
In connection with this application,
First Empire State Holding Company
has applied to become a bank holding
company.
Board of Governors of the Federal Reserve
System, January 27, 2009.
Robert deV. Frierson,
Deputy Secretary of the Board.
[FR Doc. E9–2015 Filed 1–29–09; 8:45 am]
BILLING CODE 6210–01–S
FEDERAL RESERVE SYSTEM
Formations of, Acquisitions by, and
Mergers of Bank Holding Companies;
Correction
This notice corrects a notice (FR Doc.
E9-1697) published on pages 4746 and
4747 of the issue for Tuesday, January
27, 2009.
Under the Federal Reserve Bank of
Atlanta heading, the entry for David
Weir Wood, II, Laura Halsey Wood, John
Halsey Wood, David Weir Wood, II,
Sidney Wood Clap, Katherine Wood
Hamilton, all of Birmingham, Alabama,
and Susan Soule Wood, Pensacola,
Florida, is revised to read as follows:
A. Federal Reserve Bank of Atlanta
(Steve Foley, Vice President) 1000
Peachtree Street, N.E., Atlanta, Georgia
30309:
1. David Weir Wood, II, Laura Halsey
Wood, John Halsey Wood, David Weir
Wood, II, Sidney Wood Clap, Katherine
Wood Hamilton, all of Birmingham,
Alabama, and Susan Wood Soule,
Pensacola, Florida; to acquire additional
shares of Capital South Bancorp, and its
subsidiary CapitalSouth Bank, both of
Birmingham, Alabama.
Comments on this application must
be received by February 9, 2009.
Board of Governors of the Federal Reserve
System, January 27, 2009.
Robert deV. Frierson,
Deputy Secretary of the Board.
[FR Doc. E9–2014 Filed 1–29–09 8:45 am]
BILLING CODE 6210–01–S
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FEDERAL TRADE COMMISSION
[File No. 081 0214]
Dow Chemical Company; Analysis of
Agreement Containing Consent Orders
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.
DATES: Comments must be received on
or before February 23, 2009.
ADDRESSES: Interested parties are
invited to submit written comments.
Comments should refer to ‘‘Dow
Chemical, File No. 081 0214,’’ 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, N.W.,
Washington, D.C. 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/ftcDowChemical). 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
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. 74, No. 19 / Friday, January 30, 2009 / Notices
(‘‘Rohm & Haas’’). Under the terms of
the Consent Agreement, Dow is required
to divest to a Commission-approved
buyer significant portions of its acrylic
monomer, acrylic latex polymer, and
hollow sphere particle businesses and to
license certain intellectual property
related to the production of the products
in these businesses. Dow is also
required to institute procedures to
ensure that the other businesses it
acquired from Rohm & Haas do not have
access directly or indirectly to
competitively sensitive non-public
information regarding the divested
assets.
The proposed Consent Agreement 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 from the
proposed Consent Agreement, modify it,
or make final the Consent Agreement’s
proposed Order.
On July 10, 2008, Dow announced a
definitive agreement to purchase all of
the outstanding shares of Rohm and
Haas in a transaction valued at $18.8
billion, including $3.5 billion in debt
assumption. The Commission’s
complaint alleges that the proposed
acquisition, if consummated, 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, by lessening
competition in the North American
markets for the research, development,
manufacture and sale of glacial acrylic
acid, butyl acrylate, ethyl acrylate,
acrylic latex polymers for traffic paint,
and hollow sphere particles. The
Consent Agreement will remedy the
alleged violation by divesting significant
acrylic monomer and acrylic polymer
research, development, production and
manufacturing assets and related
intellectual property to a third party
thereby replacing the lost competition
that would result from the acquisition in
these markets.
Analysis of Agreement Containing
Consent Order to Aid Public Comment
mstockstill on PROD1PC66 with NOTICES
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.shtm).
FOR FURTHER INFORMATION CONTACT:
Michael A. Franchak, Bureau of
Competition, 600 Pennsylvania Avenue,
NW, Washington, D.C. 20580, (202) 3263406.
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 January 23, 2009), on
the World Wide Web, at (https://
www.ftc.gov/os/2009/01/index.htm). A
paper copy can be obtained from the
FTC Public Reference Room, Room 130H, 600 Pennsylvania Avenue, NW,
Washington, D.C. 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.
II. The Proposed Complaint
I. Introduction
The Federal Trade Commission
(‘‘Commission’’) has accepted, subject to
final approval, an Agreement
Containing Consent Orders (‘‘Consent
Agreement’’) from Dow Chemical
Company (‘‘Dow’’ or ‘‘Respondent’’) to
remedy the anticompetitive effects
stemming from Dow’s proposed
acquisition of Rohm & Haas Company
VerDate Nov<24>2008
16:54 Jan 29, 2009
Jkt 217001
According to the Commission’s
proposed Complaint, the relevant lines
of commerce in which to analyze the
effects of the proposed acquisition are
the markets for the research,
development, manufacture, and sale of
certain acrylic monomers, including
glacial acrylic acid, butyl acrylate and
ethyl acrylate, as well as acrylic latex
polymer for traffic paint and hollow
sphere particles.
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5657
All of the acrylic monomer relevant
products are made from crude acrylic
acid. Glacial acrylic acid is purified
crude acrylic acid and is used to make
super absorbent polymers for personal
care and hygiene products. Butyl
acrylate and ethyl acrylate are acrylate
esters formed from reacting crude
acrylic acid with butanol and ethanol,
respectively. These acrylate esters are
then used to produce acrylic latex
polymers used in paints, architectural
coatings, and pressure sensitive
adhesives.
Acrylic latex polymer for traffic paint
and hollow sphere particles are unique
types of polymers. Acrylic latex
polymer for traffic paint is a quick
drying polymer used to mark traffic
lines on highways. Hollow sphere
particles are a type of specialty polymer
that is used in the manufacture of
coated paper to provide gloss,
brightness, and opacity.
The Complaint alleges that the
relevant geographic market in which to
analyze the anticompetitive effects of
the proposed acquisition for all of the
relevant markets is no larger than North
America. Most monomers are difficult to
ship because of their volatility. While
there are some minor imports of acrylic
monomers, they are not a meaningful
constraint on the prices of these
products in North America. Acrylic
polymers, such as those used for traffic
paint and hollow sphere particles, are
also difficult and expensive to ship long
distances. Shipping these polymers,
which must be immersed in water for
transport, is cost-prohibitive because of
the substantial added water weight
relative to the value of the polymer
itself.
The Complaint further alleges that all
of the relevant markets are highly
concentrated. For the acrylic monomer
relevant markets, the proposed
transaction would reduce the number of
significant players in those markets
from four to three with the combined
company having significant market
shares in each of the markets. The
combined entity would have a market
share exceeding 40% in glacial acrylic
acid, a market share approaching 90%
in the market for butyl acrylate, and a
market share approaching 80% in ethyl
acrylate. The markets for acrylic
polymer for traffic paint and hollow
sphere particles are even more highly
concentrated with Dow and Rohm &
Haas as the only two suppliers. As a
result, the proposed acquisition would
result in a merger to monopoly in those
markets.
Finally, the Complaint alleges that the
proposed acquisition would reduce
competition in the relevant markets by
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Federal Register / Vol. 74, No. 19 / Friday, January 30, 2009 / Notices
mstockstill on PROD1PC66 with NOTICES
eliminating direct and substantial
competition between Dow and Rohm &
Haas, by increasing Dow’s ability to
exercise market power unilaterally in
the relevant markets, and/or by
increasing the likelihood of coordinated
interaction in the markets for glacial
acrylic acid, butyl acrylate, and ethyl
acrylate. The Complaint further alleges
that potential new entry or fringe
expansion would not prevent the
anticompetitive effects described in the
Complaint.
III. Terms of the Proposed Order
Under the proposed Consent
Agreement, Dow will divest to a single
Commission-approved Acquirer a
significant part of its acrylic monomer
and polymer research and development
and production assets including: its
acrylic monomer production facility in
Clear Lake, Texas; its acrylic polymer
production assets located in St. Charles,
Louisiana; its acrylic polymer
production facility located in Alsip,
Illinois; its acrylic polymer production
facility located in Torrance, California;
its acrylic monomer research and
development group located in South
Charleston, West Virginia; its acrylic
latex polymer research and
development group located in Cary,
North Carolina, and other assets related
to such businesses. The divestiture
would also include the technology that
is primarily related to these businesses,
and further provides that Dow license to
the Acquirer any intellectual property
not primarily related to the divested
business that Dow nonetheless uses in
those businesses, and requires Dow to
divest the business contracts of the
divested businesses, and obtain the
consents that are necessary to assign
those contracts to the Acquirer. The
divestiture to a single acquirer of both
acrylic monomer and acrylic polymer
research, development, manufacture
and production assets best replicates the
pre-acquisition market structure in
which each of the significant acrylic
monomer firms was forward-integrated
into the supply of acrylic polymers.
In order to ensure the transition of the
divested assets and the viability of the
Acquirer, the Consent Agreement
requires Dow to provide certain
services. First, Dow is required to
continue to provide certain input
products to the Acquirer that Dow
provided previously to the divested
assets. Second, the Consent Agreement
requires Dow to provide transition
services for a short period of time to
accomplish the transition of the
divested assets to the Acquirer. Finally,
the Consent Agreement requires that
Dow continue to provide site services to
VerDate Nov<24>2008
16:54 Jan 29, 2009
Jkt 217001
the Acquirer in connection with the
acrylic polymer production assets
located in St. Charles, Louisiana, where
the Acquirer will operate a business
unit that, although largely separate, is
located on the grounds of a larger Dow
facility.
The Consent Agreement remedies the
competitive concerns in the markets for
hollow sphere particles and acrylic latex
polymer for traffic paint by requiring
Dow to divest the intellectual property
that is primarily related to these
products and to license certain other
intellectual property used for these
products. In addition, Dow is required
to supply hollow sphere particles and
acrylic latex polymer for traffic paint to
the Acquirer at its manufacturing cost,
until such time as the Acquirer is able
to develop its own manufacturing.
The Consent Agreement also requires
Dow to institute procedures to ensure
that it does not have access directly, or
indirectly, to competitively sensitive
non-public information obtained from
the Divested Businesses and Facilities
or to use any such competitively
sensitive non-public information it
already has in an anticompetitive
manner.
The proposed Order gives the
Commission the power to appoint an
interim monitor to assure that Dow
expeditiously complies with all of its
obligations and performs all of its
responsibilities as required by the
Order. If Dow fails to sell the divested
assets within the later of (1) 240 days
after the Consent Agreement is accepted
by the Commission for Public Comment
and (2) 240 days after the Acquisition
closes, the Order allows for the
appointment of a Divestiture Trustee to
divest the assets that are the subject of
the proposed Order. In order to ensure
that the Commission remains informed
about the status of the proposed
divestitures and the transfers of assets,
the proposed Consent Agreement
requires Dow to file reports with the
Commission periodically until the
divestitures and transfers are
accomplished.
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.
Donald S. Clark
Secretary
[FR Doc. E9–2081 Filed 1–29–09: 8:45 am]
[BILLING CODE 6750–01–S]
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DEPARTMENT OF HEALTH AND
HUMAN SERVICES
Centers for Disease Control and
Prevention
[60-Day–09–09AM]
Proposed Data Collections Submitted
for Public Comment and
Recommendations
In compliance with the requirement
of Section 3506(c)(2)(A) of the
Paperwork Reduction Act of 1995 for
opportunity for public comment on
proposed data collection projects, the
Centers for Disease Control and
Prevention (CDC) will publish periodic
summaries of proposed projects.
Alternatively, to obtain a copy of the
data collection plans and instrument,
call 404–639–5960 and send comments
to Maryam I. Daneshvar, CDC Reports
Clearance Officer, 1600 Clifton Road,
NE., MS–D74, Atlanta, Georgia 30333;
comments may also be sent by e-mail to
omb@cdc.gov.
Comments are invited on (a) whether
the proposed collection of information
is necessary for the proper performance
of the functions of the agency, including
whether the information shall have a
practical utility; (b) the accuracy of the
agency’s estimate of the burden of the
proposed collection of information; (c)
ways to enhance the quality, utility, and
clarify of the information to be
collected; and (d) ways to minimize the
burden of the collection of information
on respondents, including through the
use of information technology. Written
comments should be received within 60
days of this notice.
Proposed Project
Prevalence Survey of Healthcare
Acquired Infections (HAIs) in U.S.
Acute Care Hospitals—New—National
Center for Preparedness, Detection, and
Control of Infectious Diseases
(NCPDCID), Centers for Disease Control
and Prevention (CDC).
Background and Brief Description
CDC is requesting OMB approval to
conduct a survey to obtain national
estimates of HAIs prevalence in the
United States. Preventing HAIs is a CDC
priority. An essential step in reducing
the occurrence of HAIs is to accurately
estimate the burden of these infections
in U.S. hospitals and to describe the
types of HAIs and their causative
organisms. The scope and magnitude of
HAIs in the U.S. were last directly
estimated in the 1970s and 1980s by
CDC’s Study on the Efficacy of
Nosocomial Infection Control (SENIC),
in which comprehensive data were
E:\FR\FM\30JAN1.SGM
30JAN1
]]>Agencies
[Federal Register Volume 74, Number 19 (Friday, January 30, 2009)]
[Notices]
[Pages 5656-5658]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E9-2081]
=======================================================================
-----------------------------------------------------------------------
FEDERAL TRADE COMMISSION
[File No. 081 0214]
Dow Chemical Company; Analysis of Agreement Containing Consent
Orders 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 February 23, 2009.
ADDRESSES: Interested parties are invited to submit written comments.
Comments should refer to ``Dow Chemical, File No. 081 0214,'' 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, N.W., Washington, D.C. 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-DowChemical). 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
[[Page 5657]]
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.shtm).
FOR FURTHER INFORMATION CONTACT: Michael A. Franchak, Bureau of
Competition, 600 Pennsylvania Avenue, NW, Washington, D.C. 20580, (202)
326-3406.
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 January 23, 2009), on the World Wide Web, at (https://www.ftc.gov/
os/2009/01/index.htm). A paper copy can be obtained from the FTC Public
Reference Room, Room 130-H, 600 Pennsylvania Avenue, NW, Washington,
D.C. 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 Orders (``Consent
Agreement'') from Dow Chemical Company (``Dow'' or ``Respondent'') to
remedy the anticompetitive effects stemming from Dow's proposed
acquisition of Rohm & Haas Company (``Rohm & Haas''). Under the terms
of the Consent Agreement, Dow is required to divest to a Commission-
approved buyer significant portions of its acrylic monomer, acrylic
latex polymer, and hollow sphere particle businesses and to license
certain intellectual property related to the production of the products
in these businesses. Dow is also required to institute procedures to
ensure that the other businesses it acquired from Rohm & Haas do not
have access directly or indirectly to competitively sensitive non-
public information regarding the divested assets.
The proposed Consent Agreement 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 from the
proposed Consent Agreement, modify it, or make final the Consent
Agreement's proposed Order.
On July 10, 2008, Dow announced a definitive agreement to purchase
all of the outstanding shares of Rohm and Haas in a transaction valued
at $18.8 billion, including $3.5 billion in debt assumption. The
Commission's complaint alleges that the proposed acquisition, if
consummated, 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, by lessening competition in the North
American markets for the research, development, manufacture and sale of
glacial acrylic acid, butyl acrylate, ethyl acrylate, acrylic latex
polymers for traffic paint, and hollow sphere particles. The Consent
Agreement will remedy the alleged violation by divesting significant
acrylic monomer and acrylic polymer research, development, production
and manufacturing assets and related intellectual property to a third
party thereby replacing the lost competition that would result from the
acquisition in these markets.
II. The Proposed Complaint
According to the Commission's proposed Complaint, the relevant
lines of commerce in which to analyze the effects of the proposed
acquisition are the markets for the research, development, manufacture,
and sale of certain acrylic monomers, including glacial acrylic acid,
butyl acrylate and ethyl acrylate, as well as acrylic latex polymer for
traffic paint and hollow sphere particles.
All of the acrylic monomer relevant products are made from crude
acrylic acid. Glacial acrylic acid is purified crude acrylic acid and
is used to make super absorbent polymers for personal care and hygiene
products. Butyl acrylate and ethyl acrylate are acrylate esters formed
from reacting crude acrylic acid with butanol and ethanol,
respectively. These acrylate esters are then used to produce acrylic
latex polymers used in paints, architectural coatings, and pressure
sensitive adhesives.
Acrylic latex polymer for traffic paint and hollow sphere particles
are unique types of polymers. Acrylic latex polymer for traffic paint
is a quick drying polymer used to mark traffic lines on highways.
Hollow sphere particles are a type of specialty polymer that is used in
the manufacture of coated paper to provide gloss, brightness, and
opacity.
The Complaint alleges that the relevant geographic market in which
to analyze the anticompetitive effects of the proposed acquisition for
all of the relevant markets is no larger than North America. Most
monomers are difficult to ship because of their volatility. While there
are some minor imports of acrylic monomers, they are not a meaningful
constraint on the prices of these products in North America. Acrylic
polymers, such as those used for traffic paint and hollow sphere
particles, are also difficult and expensive to ship long distances.
Shipping these polymers, which must be immersed in water for transport,
is cost-prohibitive because of the substantial added water weight
relative to the value of the polymer itself.
The Complaint further alleges that all of the relevant markets are
highly concentrated. For the acrylic monomer relevant markets, the
proposed transaction would reduce the number of significant players in
those markets from four to three with the combined company having
significant market shares in each of the markets. The combined entity
would have a market share exceeding 40% in glacial acrylic acid, a
market share approaching 90% in the market for butyl acrylate, and a
market share approaching 80% in ethyl acrylate. The markets for acrylic
polymer for traffic paint and hollow sphere particles are even more
highly concentrated with Dow and Rohm & Haas as the only two suppliers.
As a result, the proposed acquisition would result in a merger to
monopoly in those markets.
Finally, the Complaint alleges that the proposed acquisition would
reduce competition in the relevant markets by
[[Page 5658]]
eliminating direct and substantial competition between Dow and Rohm &
Haas, by increasing Dow's ability to exercise market power unilaterally
in the relevant markets, and/or by increasing the likelihood of
coordinated interaction in the markets for glacial acrylic acid, butyl
acrylate, and ethyl acrylate. The Complaint further alleges that
potential new entry or fringe expansion would not prevent the
anticompetitive effects described in the Complaint.
III. Terms of the Proposed Order
Under the proposed Consent Agreement, Dow will divest to a single
Commission-approved Acquirer a significant part of its acrylic monomer
and polymer research and development and production assets including:
its acrylic monomer production facility in Clear Lake, Texas; its
acrylic polymer production assets located in St. Charles, Louisiana;
its acrylic polymer production facility located in Alsip, Illinois; its
acrylic polymer production facility located in Torrance, California;
its acrylic monomer research and development group located in South
Charleston, West Virginia; its acrylic latex polymer research and
development group located in Cary, North Carolina, and other assets
related to such businesses. The divestiture would also include the
technology that is primarily related to these businesses, and further
provides that Dow license to the Acquirer any intellectual property not
primarily related to the divested business that Dow nonetheless uses in
those businesses, and requires Dow to divest the business contracts of
the divested businesses, and obtain the consents that are necessary to
assign those contracts to the Acquirer. The divestiture to a single
acquirer of both acrylic monomer and acrylic polymer research,
development, manufacture and production assets best replicates the pre-
acquisition market structure in which each of the significant acrylic
monomer firms was forward-integrated into the supply of acrylic
polymers.
In order to ensure the transition of the divested assets and the
viability of the Acquirer, the Consent Agreement requires Dow to
provide certain services. First, Dow is required to continue to provide
certain input products to the Acquirer that Dow provided previously to
the divested assets. Second, the Consent Agreement requires Dow to
provide transition services for a short period of time to accomplish
the transition of the divested assets to the Acquirer. Finally, the
Consent Agreement requires that Dow continue to provide site services
to the Acquirer in connection with the acrylic polymer production
assets located in St. Charles, Louisiana, where the Acquirer will
operate a business unit that, although largely separate, is located on
the grounds of a larger Dow facility.
The Consent Agreement remedies the competitive concerns in the
markets for hollow sphere particles and acrylic latex polymer for
traffic paint by requiring Dow to divest the intellectual property that
is primarily related to these products and to license certain other
intellectual property used for these products. In addition, Dow is
required to supply hollow sphere particles and acrylic latex polymer
for traffic paint to the Acquirer at its manufacturing cost, until such
time as the Acquirer is able to develop its own manufacturing.
The Consent Agreement also requires Dow to institute procedures to
ensure that it does not have access directly, or indirectly, to
competitively sensitive non-public information obtained from the
Divested Businesses and Facilities or to use any such competitively
sensitive non-public information it already has in an anticompetitive
manner.
The proposed Order gives the Commission the power to appoint an
interim monitor to assure that Dow expeditiously complies with all of
its obligations and performs all of its responsibilities as required by
the Order. If Dow fails to sell the divested assets within the later of
(1) 240 days after the Consent Agreement is accepted by the Commission
for Public Comment and (2) 240 days after the Acquisition closes, the
Order allows for the appointment of a Divestiture Trustee to divest the
assets that are the subject of the proposed Order. In order to ensure
that the Commission remains informed about the status of the proposed
divestitures and the transfers of assets, the proposed Consent
Agreement requires Dow to file reports with the Commission periodically
until the divestitures and transfers are accomplished.
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.
Donald S. Clark
Secretary
[FR Doc. E9-2081 Filed 1-29-09: 8:45 am]
[BILLING CODE 6750-01-S]
