Sika AG and Sika Australia Pty Ltd

On 20 April 2023, the ACCC announced it had accepted a court-enforceable divestiture undertaking (Undertaking) given by Sika AG and its subsidiary, Sika Australia Pty Ltd (together, Sika) pursuant to s87B of the Competition and Consumer Act 2010 (Cth) in connection with Sika AG’s proposed acquisition of MBCC group of companies (MBCC) (the Proposed Acquisition). In accordance with the Undertaking, Sika proposes to divest:

• MBCC’s Admixtures Systems business in Europe (including Switzerland), the UK, Canada, and the US, and
• MBCC’s EBA and Construction Systems business of MBCC Group in Australia and New Zealand. This comprises all of MBCC Group’s business in Australia (including Bluey Technologies) and New Zealand.

Together, the Divestiture Business.

The ACCC was concerned that in the absence of the Undertaking, the Proposed Acquisition would have the effect, or would be likely to have the effect, of substantially lessening competition in the supply of chemical admixtures in Australia.

The Undertaking identifies the Seventh Cinven Fund, which is managed by Cinven Capital Management (VII) General Partner Limited, as the Approved Purchaser of the Divestiture Business.

Objective of the Undertaking

The objective of the Undertaking is to address the ACCC’s competition concerns, as set out above, that would otherwise arise because of the Proposed Acquisition.

The Undertaking aims to achieve this objective by placing obligations on Sika to:

• ensure that the Divestiture Business is sold to an Approved Purchaser that will result in the creation or strengthening of a viable, effective, stand-alone, independent and long term competitor for the supply of chemical admixtures in Australia;
• ensure the purchaser of the Divestiture Business has all the necessary associated assets and rights to compete effectively with Sika in the supply of chemical admixtures in Australia;
• maintain the economic viability, marketability, competitiveness and goodwill of the Divestiture Business prior to divestiture;
• ensure that research and development facilities will transfer to the Approved Purchaser of the Divestiture Business; and
• provide for the effective oversight of Sika’s compliance with this Undertaking.