MOFCOM Cleared Marubeniís Acquisition of Gavilon with Conditions
1. What will be the relevant markets regarding Marubeni/Gavilon?
What are key factors that MOFCOM take into consideration when making the decision of relevant markets?
MOFCOM found the relevant markets to be imported soybean, corn, soybean meal and distillerís dried grain (DDG), taking into account the business scope and business model of the parties, the characteristics of the commodities, as well as supply and demand substitution.
2. How is the competitive assessment regarding such acquisition?
By providing detailed competition analysis regarding Chinaís soybean import market, MOFCOM found that the Transaction may substantially strengthen Marubeniís control power in China soybean import market and may eliminate and restrict competition in this market.
3. What requests Marubeni shall be restricted to in this deal?
MOFCOM imposed the so-called hold-separate remedy in this deal, in which Marubeni was requested to:
1). Establish two independent legal entities to operate the China soybean import and distribution business.
2). Hold the two soybean subsidiaries separate from each other.
3). Keep the Marubeni Soybean Sub and Gavilonís US asset at armís length.
4). Prevent exchange of competition-related information between Marubeni Soybean Sub and Gavilon Soybean Sub.
MOFCOM also clearly requested Marubeni to appoint a supervising trustee to supervise the above mentioned commitments.
MOFCOM set a 24-month time period for these commitments. Upon the lapse of the 24months, Marubeni can apply to MOFCOM to revoke Items (1) to (4) of the commitments.