CCP Approves Fatima Fertilizer’s Agritech Deal

The Competition Commission of Pakistan (CCP) recently approved the acquisition of Agritech Limited by Fatima Fertilizer Company Limited after completing its Phase I competition review. The company's share purchase was completed through the Pakistan Stock Exchange in two stages, with the first acquisition occurring in 2023 and a subsequent acquisition in 2024.

Both transactions were evaluated by the CCP together. Fatima Fertilizer is involved in the manufacturing, purchasing, selling, importing and exporting of fertilizers and chemicals, while Agritech specializes in producing and selling urea and granulated Single Super Phosphate (SSP) fertilizer. The CCP focused on the potential impact of the transaction on competition within Pakistan's fertilizer market, particularly in the urea and SSP markets.

The commission discovered a horizontal overlap in the urea market between the two companies, which resulted in an increased combined market share. However, Fatima Fertilizer had no market share in the SSP market, so Agritech's position remained unaffected. Throughout the review process, Fatima Fertilizer informed the CCP that it had disposed of its entire shareholding in Agritech and had no intention of continuing to pursue control over the company.

Consequently, Fatima Fertilizer held no shares in Agritech when the CCP made its decision. After considering the findings, the CCP determined that the transaction would not risk substantially diminishing competition. It concluded that the deal would not create barriers to entry, significantly amplify market power for parties involved, or establish or strengthen a dominant position.

The CCP therefore authorized the transaction under Section 31(1)(d)(i) of the Competition Act, 2010.