DuPont will have to divest some crop protection assets to gain European approval of its $130 billion merger with The Dow Chemical Company.
The European Commission granted conditional clearance of the deal on Monday, a significant milestone for the merger and subsequent plan to split the combined business into three independent companies.
The European approval is conditional on DuPont selling its cereal broadleaf herbicides and chewing insecticides portfolios. DuPont must also divest its crop protection research and development pipeline and organization, with some exceptions, including seed treatment, nematicides and late-stage R&D projects.
DuPont says it’s currently in negotiations to sell these assets.
On the Dow side, European approval is conditional on an earlier-announced deal to sell Dow’s ethylene acrylic acid copolymer and ionomers business being finalized.
“We need effective competition in this sector so companies are pushed to develop products that are ever safer for people and better for the environment. Our decision today ensures that the merger between Dow and DuPont does not reduce price competition for existing pesticides or innovation for safer and better products in the future,” said EU Commissioner Margrethe Vestager (read more on the commission’s decision here.)
In a joint statement, both companies said the merged agriculture division will retain “an excellent portfolio in corn and soy broadleaf and grass control, a robust cereal weed control portfolio, DuPont’s strong position in disease control, and Dow AgroSciences’ industry leading insecticide portfolio.”