Dainippon to Buy Bayer Pigment Business

The US Federal Trade Commission (FTC) has just approved the purchase of one of Bayer’s industrial pigment businesses by a subsidiary of Dainippon Ink and Chemicals. However the sale comes with a condition.

The Bayer pigments business produces a premium pigment called perylene which is often used in automotive paints to make them fade resistant under various weather conditions. At present there are three producers of perylene, and after the acquisition, there would only be two. The FTC was concerned that the price of this pigment would be driven up as a result of reduced competition. Consequently, it has made Dainippon sell off part of its US operation that produces perylene as part of the deal to acquire the Bayer pigments business.

To satisfy this condition of purchase, Dainippon will sell this part of its US business to Ciba Specialty Chemicals Inc., a division of Ciba Specialty Chemicals Corp.

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