The European Commission permitted Celanese (NYSE:CE) to go ahead with its planned $11 billion acquisition of DuPont’s mobility and materials unit on the condition that Celanese sells a plastics business.
Celanese announced the purchase agreement in February, pending approvals from antitrust authorities. The company must divest its global thermoplastic copolyester (TPC) business, including a plant in Italy and certain brands, to receive EU approval.
Without the divestiture, Celanese would become the biggest TPC producer in the European Economic Area and worldwide, leaving few other alternatives. Automakers are among the biggest users of the material.
Celanese proposed selling the business to Italian engineering plastics producer Taro Plast. The sale includes the Pibiflex and Riteflex brands of TPC.
“The commitments offered by Celanese, divesting a stand-alone business, fully remove our competition concerns as they ensure that a player will remain in the market,” Margrethe Vestager, the commission’s head of competition policy, said in a statement dated Oct. 11.
Celanese (CE) has declined 44% this year, while DuPont (NYSE:DD) has slid 34%, compared with a 24% drop for the S&P 500 Stock Index (SP500).