NERA's Role in Quaker's Acquisition of Houghton

NERA Economic Consulting is pleased to have advised the merging parties in two of the four mergers approved by the European Commission on 11 December 2018. These are the acquisition of MKM by KME, which has been cleared following an in-depth investigation, and the acquisition of Houghton by Quaker, which has been cleared subject to conditions.

The Situation

In October 2018, Quaker notified its proposed acquisition of Houghton to the European Commission. Both Quaker and Houghton are suppliers of industrial lubricants, and in particular of a family of metal working fluids known as rolling oils. The European Commission was concerned about the loss of competition that the transaction would have entailed in the highly concentrated markets for: (i) aluminium hot rolling oils; (ii) steel hot rolling oils; and (iii) steel cold rolling oils in the European Economic Area.

NERA's Role

Quaker retained NERA Economic Consulting to assist its legal advisers throughout the transaction’s notification and review process in the US, EU and Asia.

The Result

To address the European Commission’s concerns in the three markets listed above, Quaker offered to divest Houghton’s business in these markets. Having taken the time to identify a global upfront buyer for the divestment business earlier on, Quaker was in a position to offer its commitments shortly after the notification of the transaction was resubmitted. The European Commission conditionally cleared the transaction in December 2018. Quaker is awaiting final approval by the FTC.

For more details, please find the press release of the European Commission here.