European Commission clears proposed DSM and Sinochem joint venture

The European Commission has cleared under the EU Merger Regulation the proposed joint venture between the Dutch pharmaceutical and nutrition company DSM and Sinochem, a Chinese state-owned conglomerate.

The joint venture, which was announced late last year and involved DSM selling a 50% stake in its penicillin operations to Sinochem for 210 million euros ($298 million), will primarily be active in the field of certain antibiotics and other anti-infective products used for treating bacterial, fungal and other infections.

The Commission said it carefully examined the effects of the proposed transaction, including the issue of possible coordination by the Chinese state of the market behavior of different state-owned firms. The Commission concluded that even if all Chinese state-owned firms acted as one, there would still be a sufficient level of competition in the markets concerned.