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Purpose of the notification of the proposed acquisition
The ECOWAS Regional Competition Authority (ERCA) received a merger notification from Specialty Bidco B.V., and Essential Bidco B.V. and Essential. (“CVC Fund XI”) concerning the Acquisition of EssentialCo & SpecialtyCo Businesses (ANH Businesses).
The proposed transaction constitutes sole control over the animal nutrition and health business (ANH Businesses) of DSM-Firmenich AG, which comprise of “SpecialtyCo Business and “EssentialCo Business.” Therefore, this transaction is subject to notification to the ERCA under the provisions of Regulation C/REG.23/12/21. The CVC Fund XI and its affiliates and their subsidiaries will have direct control of the operations of the targets related to its activities, such as performance solutions and precision services businesses; and distribution of vitamins, carotenoids, and aroma ingredients (including synthetic lavender.
The notification of the transaction to ERCA, for the purpose of prior authorization, is in accordance with Article 2 (1) (a) of Regulation C/REG.23/12/21 on the rules of procedure for mergers and acquisitions in ECOWAS, the Enabling Rules PC/REX.1/01/24 on the threshold for mergers and acquisitions; and the thresholds for dominant and monopolistic positions. As the acquisition involves entities in four (4) ECOWAS member States, it is, therefore, subject to notification to ERCA under the provisions of Regulation C/REG.23/12/21.
Concerned parties.
Acquiring Firms:
“SpecialtyCo Purchasers (Specialty Bidco B.V. and Specialty (U.S.) Bidco) are new newly incorporated investment private limited liability companies registered in Netherlands and United States. These companies as investment vehicles are owned by CVC Fund IX, and in turn, indirectly controlled by funds or vehicles advised or managed by affiliates of CVC Capital Partners plc (“CVC plc”), a public limited company incorporated under the laws of Jersey, United States.
The Acquiring Firms as newly incorporated investment vehicles do not have any activities within the Community market, however, through being owned by CVC Funds IX, the activities of which spanned in different portfolios within the region through its stakes in affiliates and subsidiaries.
CVC and CVC Network:
The company operates within West Africa as a global alternative investment manager focused on private equity, credit, infrastructure and secondaries. Specifically, the CVC Network through its interest in various companies within the region:
- IT sector (service provider offering e-SIM data plans for travellers);
- provision of OTC medicines, dietary supplements, and medical devices;
- video games developer and service provider;
- supplier of dry pasta, sauces and couscous;
- distribution and light manufacturing business;
- drugs for the treatment of hypertension and other cardiovascular disorders;
- logistics and freight forwarding solutions provider;
- software, cloud and mobile solutions provider;
- provider of insurance and reinsurance;
- many portfolio investments in other companies
Target Business (ANH Business)
Target Business is a global provider of science-based animal nutrition and health solutions. It offers products ranging from vitamins over premixes, to feed additives that improve animal health, performance, feed efficiency, and sustainability across livestock production. Through its product offerings, it provides essential products such as
- fat-soluble vitamins (A, D, E, or K) support key physiological functions including growth, reproduction, immunity, vision, and bone strength, and
- water-soluble vitamins (B-complex and C) maintain health and development and require regular replenishment.
The Target also provides “Premixes” that serve as a link from feed additives to final feed composition in the animal nutrition value chain, offering premix type such as vitamin concentrates, consisting of vitamin combinations plus carriers.
In addition, the Target provide performance solutions, such as: Eubiotics, which include probiotics, prebiotics, phytogenic and essential oils, and organic acids; Mycotoxin Solutions; and Specialty Nutrients, comprising Hy-D, a proprietary fast-track vitamin D3 source that supports the development of a strong skeleton, immunity, and lifetime performance.
Concerned Acquisition
The proposed transaction concerns a sole control over the EssentialCo and SpecialtyCo Businesses (ANH Business) in the production and sale of both essential scienced based nutrition and health solutions within the Community market.
Expected results of the acquisition
The proposed transaction will lead to a sole control of ANH Business of the Target, with intended purpose to strengthen and diversify investment in science-based nutrition and health solutions around the world. This is further expected to enhanced its private equity financial investment, which is in line with its investment strategies.
The proposed transaction is expected to increase the production and distribution of science- based nutrition and health solutions within the ECOWAS region.
Rights of third parties
Pursuant to Article 44 (2) (a) (iv) of the ECOWAS Regional Competition Authority’s Manual of Investigation and Notification Procedures, third parties are invited to submit their comments to ERCA within thirty (30) days of the publication of this communication.
Such comments shall be accompanied by any documentation capable of substantiating the facts and analyses and sent confidentially to the following address:
ECOWAS Regional Competition Authority
Bertil Harding, Bijilo, The Gambia
P.O Box 4470
Or electronically at the following email address: registry@erca-arcc.org.