ΚΥΠΡΙΑΚΗ ΔΗΜΟΚΡΑΤΙΑ Decision CPC: 66/2022 Case Number: 08.05.001.022.052 THE CONTROL OF CONCENTRATIONS BETWEEN ENTERPRISES LAW No. 83(Ι)/2014 Notification of concentration concerning the acquisition of the share capital of VGP Holdings LLC (international product business division) fromSaudi Arabian Oil Company via Aramco Overseas Company B.V. Commission for the Protection of Competition: Mrs. Loukia Christodoulou Chairperson Mr. Panayiotis Oustas, Member Mr. Aristos Aristidou Palouzas, Member Date of decision: 6 October 2022 SUMMARY OF DECISION On the 9th of September 2022 the Commission for the Protection of Competition (hereinafter the “Commission”) received on behalf of Aramco Overseas Company B.V., a notification of a proposed concentration. The notification was filed according to Section 10 of the Control of Concentrations between Enterprises Law 83(I)/14 (hereinafter the “Law”). The notification concerns a concentration, according to which Saudi Arabian Oil Company (hereinafter the “Saudi Aramco”) via Aramco Overseas Company B.V. (hereinafter the “AOC”) intends to acquire the share capital of VGP Holdings LLC (hereinafter the “VGP” or “Target”), the parent company of Valvoline Inc.'s which manages the international product business division. Companies participating at this merger are the following: 1
- Aramco Overseas Company B.V. (hereinafter "AOC") is a private limited company duly registered under the laws of the Netherlands. AOC operates by providing its affiliated entities with a wide range of services, including financial support services, supply chain management, technical support and a variety of administrative support services. AOC is exclusively owned subsidiary of Saudi Arabian Oil Company.
- SaudiArabian Oil Company (hereinafter the “Saudi Aramco”) is a company duly registered under the laws of Saudi Arabia with shares listed on the Saudi Stock Exchange (joint stock company). Saudi Aramco is principally engaged in the prospecting, exploration, drilling and extraction of hydrocarbon substances and the processing, production, refining and marketing of such substances. The acquisition will be carried out by Gateway Velocity Holding Corp. which is a newly listed corporation duly registered under the laws of the State of Delaware of the United States of America. Gateway Velocity Holding Corp. is wholly owned subsidiary of AOC.
- Target on the current concetration is the VGP Holdings LLC, a limited liability company, duly registered under the laws of the State of Delaware of the United States of America. VGP Holdings LLC’s only activity is becoming the parent company international products business of Valvoline Inc. Valvoline Inc.'s international products business division sells engine and automotive preventative maintenance products, both under the Valvoline brand and other brand and private label products, to mass market and auto parts retailers, installers and trade customers, including distributors and licensees, as well as to original equipment manufacturers (OEMs). This notification concerns a merger that shall take place on the basis of Equity Purchase Agreement, EPA, dated 31 July 2022, between Valvoline Inc., as the Seller, Gateway Velocity Holding Corp., as Buyer 1 and Aramco Overseas Company B.V. (parent). Based on the Agreement, Buyer 1 will acquire one of Valvoline's two business divisions, namely the international products business (the Target). The other business segment (the retail services business) remains with the Seller. The Commission, considering the facts of the concentration, has concluded that this transaction constitutes a concentration within the meaning of section 6
(1)(α)(ii) of the 2 Law, since it leads to a permanent change of control of the Target bySaudi Aramco, via AOC. Furthermore, based on the information contained in the notification, the Commission found that the criteria set by section 3
(2)(
- a)of the Law were satisfied and therefore the notified concentration was of major importance falling within the scope of the Law. The Commission has concluded that for the purposes of evaluating this concentration, the relevant product / service market is lubricants market which is divided into (
- a)automotive lubricants, (
- b)industrial lubricants, (
- c)marine lubricants and (
- d)aviation lubricants. Any further separation does not change the outcome of the concentration assessment. In addition, the Commission concluded that the geographical market for the relevant markets in question is that of the territory of the Republic of Cyprus. According to the data of the notification, Target is active in the sale of automotive and industrial lubricants, while Saudi Aramco is only active in the sale of automotive lubricants in Cyprus. Therefore, there is horizontal overlap between the Parties in the market for the sale of lubricants in Cyprus, in which both Parties operate. Their combined market share is [0-5] % in the automotive lubricants market having as result no horizontally affected market in the Republic of Cyprus. None of Saudi Aramco's activities in Cyprus relate to a vertically related market, upstream or downstream, of the Target's activities. Taking into account the above, the Commission concludes that in this concentration no affected market is created based on Annex I of the Law. In addition, there are no other markets in which the notified concentration may have a significant effect. The Commission, on the basis of the factual and legal circumstances, unanimously decided that this concentration does not create or strengthen a dominant position as there is no affected market and therefore the concentration does not raise serious doubts as to its compatibility with the operation of the competition in the market. 3 Therefore, the Commission, acting in accordance with section 22 of the Law, unanimously decided not to oppose the notified concentration and declare it as being compatible with the operation of the competition in the market. Loukia Christodoulou Chairperson of the Commission for the Protection of Competition 4