Merger in the Water Chemistry Market: Kemira Acquires Family-Owned Company Sidra
Federal Cartel Office Approves Acquisition
Advertisement
Following an in-depth antitrust review, the Federal Cartel Office has approved the planned acquisition of Sidra Wasserchemie GmbH, Ibbenbüren, by the Finnish water chemicals supplier Kemira Oyj, Helsinki.
Andreas Mundt, President of the Federal Cartel Office: “Our extensive investigation has shown that Kemira and Sidra will achieve a strong market position, particularly with regard to iron salts, in parts of Germany and, to some extent, in neighboring countries as well. However, there are still enough competitors both domestically and abroad to sufficiently limit the parties’ scope for action in the future. For this reason, we were able to approve the merger.”
Kemira Oyj is a global company that, from 58 production sites, supplies chemical products to water-intensive industries and to municipal water and wastewater management. Kemira’s domestic production sites for iron and aluminum salts are located in Dormagen and Rheinberg (both in North Rhine-Westphalia). Other production sites are located in Poland and the Czech Republic, among other places.
Sidra is a family-owned company that, with its two domestic production facilities in Ibbenbüren (North Rhine-Westphalia) and Bitterfeld (Saxony-Anhalt), supplies customers in Germany and the Benelux countries with specific water treatment chemicals, namely iron salts. Sidra also has a sales office in Belgium.
Iron and aluminum salts are used in particular for the treatment of drinking water and the purification of wastewater. In wastewater treatment plants, they are used, among other things, to remove phosphates and other pollutants from wastewater. The numerous customers for these water treatment chemicals—particularly water utilities and municipal wastewater treatment plants—rely on a reliable supply to ensure compliance with continuously monitored regulatory limits. The costs of the water chemicals used are ultimately factored into water and wastewater fees.
As part of the main investigation, the Federal Cartel Office conducted extensive inquiries. In addition to the suppliers’ revenues and sales volumes, the investigation focused in particular on supply flows. Water treatment chemicals such as iron and aluminum salts are required in large quantities and have a comparatively low value relative to their volume. The level of transportation costs therefore limits the economically viable delivery distances. Even under favorable transportation conditions, metal salts are rarely transported over distances exceeding 500 kilometers.
The investigation has shown that, despite the strong market position of Kemira and Sidra, there are sufficient alternative sources for customers. In addition to suppliers in Germany, suppliers from neighboring countries can also exert competitive pressure.
Demand for metal salts could also increase in the future. The new EU Urban Wastewater Treatment Directive (KARL) stipulates not only additional requirements for the removal of micropollutants but also stricter requirements for the existing stages of wastewater treatment.
Note: This article has been translated using a computer system without human intervention. LUMITOS offers these automatic translations to present a wider range of current news. Since this article has been translated with automatic translation, it is possible that it contains errors in vocabulary, syntax or grammar. The original article in German can be found here.
Other news from the department business & finance
