EU exec to investigate SC Johnson’s buy of Sara Lee’s unit

BRUSSELS (BestGrowthStock) – The European Union’s executive arm opened on Wednesday an in-depth investigation into SC Johnson’s (JNSON.UL: ) acquisition of Sara Lee’s (SLE.N: ) household insect control unit, the European Commission said.

“The Commission’s initial market investigation indicated potential competition concerns with respect to the supply of household insecticide products in Spain, France, the Czech Republic, Belgium and Greece, where the parties’ activities show significant overlaps,” the Commission said in a statement.

The EU executive now has 90 working days, until 12 May 2011, to take a final decision on whether the proposed transaction would significantly impede effective competition in the European Economic Area or a substantial part of it.

The decision to open an in-depth inquiry does not prejudge the final result of the investigation.

The proposed transaction would combine two leading suppliers of household insecticides active in Europe with brands like Raid, Baygon, Catch, Vapona, Pyrel, Cruz Verde, Cucal and Bloom, the Commission said.

Both suppliers have a strong presence on the markets for all types of insecticide products like flying insect killers, crawling insect killers and anti-moth products and have substantial overlapping activities in Spain, France, Belgium, Greece and the Czech Republic.

Their household insecticide brands compete closely with each other in these countries, where the removal of an important competitor may lead to increased prices and less choice for customers.

“Remedies proposed by SC Johnson did not remove the Commission’s concerns as regards the effects of the proposed transaction,” the Commission said.

(Reporting by Jan Strupczewski)

EU exec to investigate SC Johnson’s buy of Sara Lee’s unit