Man in violation of privacy law

Breaking news and expert analysis on legal and compliance issues

[Back To Home][Back To Archives]

From Antitrust Law Daily, July 23, 2018

Wilhelmsen Maritime Services abandons proposed acquisition of Drew Marine Group

By Jody Coultas, J.D.

In light of a preliminary injunction issued by the federal district court in the District of Columbia temporarily blocking Wilhelmsen Maritime Services’ proposed acquisition of competitor Drew Marine Group, Wilhelmsen has announced that it is abandoning the deal. The FTC had alleged that the proposed $400 million acquisition of Drew Marine Group would violate the antitrust laws by significantly reducing competition in an important market for marine water-treatment chemicals and services used by global fleets (FTC v. Wilh. Wilhelmsen Holding ASA, FTC File No. 171 0161, Civil Action No. 1:18-cv-00414); (In the Matter ofWilhelm Wilhelmsen, FTC Docket No. 9380).

Marine water-treatment chemicals prevent corrosion, remove impurities, and enhance the operation of a vessel’s systems. Wilhelmsen, based in Norway, is the world’s largest supplier of water treatment chemicals and services to global fleets. New Jersey-based Drew is the second-largest such supplier. The water-treatment chemicals and services provided by the respective companies are used by "tankers, container ships, bulk carriers, cruise ships, and military support vessels to maintain critical on-board equipment."

The FTC administrative complaint maintained that the two companies are each other’s closest competitors on numerous competitive dimensions that are important to customers—including product scope, quality and consistency, technical service capability, and global distribution footprint. According to the agency, if consummated, the merger would result in Wilhelmsen’s control of "at least 60 percent of the global marine water treatment chemical and service market. The next closest competitor represents an inferior choice for global fleets, and would control less than 5 percent of the market, the FTC said.

In a sealed order, the district court enjoined and restrained Wilhelmsen and Drew under Section 13(b) of the Federal Trade Commission Act, 15 U.S.C. § 53(b), from consummating the proposed acquisition until the completion of an administrative proceeding evaluating the merger pending before the Commission.

"The U.S. District Court’s grant of a preliminary injunction to temporarily block Wilhelmsen’s proposed acquisition of Drew, and Wilhelmsen’s decision to abandon the acquisition deliver a victory for competition and consumers. The evidence shows that the acquisition would have led to higher prices and diminished service in the supply of marine water treatment chemicals to global fleets. These chemicals and services are critical in the operation of these fleets, which are vital to U.S. and global trade, and include tankers, container ships, bulk carriers, cruise ships and U.S. military support vessels," said FTC Bureau of Competition Acting Deputy Director Haidee L. Schwartz.

"We disagree with the views of the US competition authorities. This would have been an important strategic investment for our group, which we believe would have meant better services and better prices for our customer. We are therefore disappointed that we will not be able to bring the deal to a close," said Thomas Wilhelmsen, group CEO in Wilhelmsen.

Attorneys: Corey W. Roush (Akin Gump Strauss Hauer & Feld LLP) for Wilh. Wilhelmsen Holding ASA and Wilhelmsen Maritime Services AS. Mark W. Ryan (Mayer Brown LLP) for Resolute Fund II, L.P., Drew Marine Intermediate II B.V. and Drew Marine Group, Inc.

Companies: Wilh. Wilhelmsen Holding ASA; Wilhelmsen Maritime Services AS; Resolute Fund II, L.P.; Drew Marine Intermediate II B.V.; Drew Marine Group, Inc.

MainStory: TopStory AcquisitionsMergers Antitrust FederalTradeCommissionNews

Back to Top

Antitrust Law Daily

Introducing Wolters Kluwer Antitrust Law Daily — a daily reporting service created by attorneys, for attorneys — providing same-day coverage of breaking news, court decisions, legislation, and regulatory activity.

A complete daily report of the news that affects your world

  • View full summaries of federal and state court decisions.
  • Access full text of legislative and regulatory developments.
  • Customize your daily email by topic and/or jurisdiction.
  • Search archives for stories of interest.

Not just news — the right news

  • Get expert analysis written by subject matter specialists—created by attorneys for attorneys.
  • Track law firms and organizations in the headlines with our new “Who’s in the News” feature.
  • Promote your firm with our new reprint policy.

24/7 access for a 24/7 world

  • Forward information with special copyright permissions, encouraging collaboration between counsel and colleagues.
  • Save time with mobile apps for your BlackBerry, iPhone, iPad, Android, or Kindle.
  • Access all links from any mobile device without being prompted for user name and password.