11 October 2023

On 22 September 2023, the Competition and Consumer Commission of Singapore (“CCCS”) cleared the proposed acquisition by FUJIFILM Holdings America Corporation (“Fujifilm”) of CMC Materials KMG Corporation (“KMG”) and certain of its direct and indirect subsidiaries (“Proposed Transaction”).

KMG is currently fully owned by CMC Materials LLC, which, in turn, is fully owned by Entegris, Inc. The Proposed Transaction, if carried into effect, will result in Fujifilm owning 100% of the issued and outstanding equity interests of the electronic chemicals business of Entegris, Inc., which is operated by KMG.

CCCS’s clearance decision follows a public consultation from 17 to 31 August 2023 after CCCS accepted an application from Fujifilm and CMC Materials LLC on 11 August 2023 for a decision on whether the Proposed Transaction would infringe section 54 of the Competition Act 2004. Section 54 prohibits mergers which have resulted, or may be expected to result, in a substantial lessening of competition within any market in Singapore.

Allen & Gledhill acts as Singapore antitrust counsel

The Allen & Gledhill Competition & Antitrust Practice is acting as Singapore antitrust counsel to Fujifilm and joint representative to both parties in respect of the notification.

The parties

Set out below is a brief description of Fujifilm and KMG as set out in CCCS’s media release:

  • Fujifilm is part of the FUJIFILM corporate group, a multinational conglomerate operating in a wide range of businesses, including electronic materials, chemicals, electronic imaging, graphic arts and printing, industrial products, optical devices, recording media, imaging colorants, healthcare, and pharmaceuticals.
  • KMG is a supplier of high-purity process chemicals (“HPPCs”) used principally to clean, etch and dry silicon wafers in the production of semiconductors, photovoltaics (solar cells), and flat panel displays in multiple stages of their manufacturing processes.

CCCS’s assessment and conclusion

CCCS’s assessment focused on the impact of the Proposed Transaction on competition in the supply of cleaning solutions used principally in the semiconductor manufacturing process on a global scale, a narrower nationwide scale, and within narrower segments by molecular level.

CCCS concluded that the Proposed Transaction, if carried into effect, will not lead to a substantial lessening of competition in any of the relevant markets due to the following:

  • The combined market share of the merged entity generally does not cross the indicative thresholds set out in the CCCS Guidelines on the Substantive Assessment of Mergers. Where the merged entity’s market shares exceed the thresholds, the incremental market shares are low;
  • Fujifilm and KMG are not each other’s closest competitor in the relevant markets, and the merged entity will continue to face significant competition from existing strong competitors post-merger;
  • Customers sufficiently multi-source and can switch between suppliers with relative ease; and
  • The sufficiently low price transparency of HPPCs and the qualification process reduce the risk of collusion between market players.

CCCS’s Grounds of Decision will be made available in due course on CCCS’s Public Register at www.cccs.gov.sg.

Reference materials

The following materials are available on the CCCS website www.cccs.gov.sg: