The Competition and Consumer Commission of Singapore (CCCS) has cleared the proposed acquisition of Dyna-Mac Holdings by Hanwha Ocean SG Holdings

The Competition and Consumer Commission of Singapore (CCCS) has cleared the proposed acquisition of Dyna-Mac Holdings No4 by Hanwha Ocean SG Holdings. 

CCCS has assessed that the Proposed Transaction, if carried into effect, will not infringe the section 54 prohibition of the Competition Act 2004, which prohibits mergers that may substantially lessen competition within any market in Singapore.

To recap, CCCS began reviewing Hanwha’s application for a decision on whether the Proposed Transaction would infringe section 54 of the Act on Oct 3. CCCS conducted a public consultation from Oct 4 to 18 and sought feedback from various stakeholders, including competitors and customers of Hanwha and Dyna-Mac. Most respondents did not raise any concerns.

See more: Hanwha Group's offer for Dyna-Mac turns unconditional with acceptances; offer to remain open till Nov 20

Hanwha, through Hanwha Ocean, will engage in the construction of offshore plants, which include production facilities such as floating production storage and offloading vessels and drilling rigs. Topside modules, which Dyna-Mac supplies, are input components in the production of offshore plants. As a result, Hanwha can potentially use Dyna-Mac’s topside modules in their construction of offshore plants.

Given the potential supplier-customer relationship between the parties, CCCS’s assessment focused on the risk of input foreclosure, that is, whether competition will be adversely affected in the downstream market for offshore plants. This might happen if the parties restrict the supply of Dyna-Mac’s topside modules (an upstream input) to rival downstream suppliers of offshore plants.

CCCS concluded that the Proposed Transaction is unlikely to lead to a substantial lessening of competition in the supply of offshore plants.