Competition Watchdog Gives Green Light to Sika’s Acquisition

SIKA’S £4.5 billion acquisition of MBCC Group has been given the go ahead by the Competition and Markets Authority (CMA) after the two companies agreed to sell off MBCC’s chemical admixtures division.

The CMA investigated the proposed acquisition, finding in July 2022 that it could lead to a loss of competition in the UK chemical admixtures market.

As a Phase 2 investigation was launched to further examine the problem, an interim order was issued warning the companies to keep their operations separate.

In the meantime, the firms proposed a ‘fast-track remedy’ to sell MBCC’s chemical admixtures business in the UK and Europe, avoiding a reduction in competition in that market. The proposal has been accepted by the CMA, it was announced today.

Sika’s Acquisition

Richard Feasey, Independent CMA Panel Chair, said: “After Sika and MBCC accepted early on that the deal would have caused competition concerns in the UK construction industry, we were able to focus our inquiry on their proposals to address our concerns. The proposals agreed today will maintain the level of innovation, services and quality in chemical admixtures available to concrete producers and help prevent this deal raising prices for the construction industry in the UK.

“We are pleased that by working collaboratively with the companies and other competition authorities, we have been able to reach this decision on a complex global remedy so quickly. The CMA will keep looking for ways to make merger control focused, fast and efficient.”

In November 2021, Swiss firm Sika agreed to buy the German based MBCC Group in a £4.5 billion deal. Sika and MBCC are the two largest UK suppliers of chemical admixtures, which are an essential input for products like concrete and cement used in the construction industry and control various characteristics of concrete, such as its strength or setting time.

The companies are widely regarded as the strongest suppliers in the UK market, particularly in relation to their product development and innovation capabilities, and together account for over half of the UK supply.

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