Appendix 5: Public Interest Merger Reference (Perpetuus Advanced Materials plc) (Pre-emptive Action) Order 2021 (SI 2021/993)
Additional Information from the Department for Business, Energy and Industrial Strategy
Q1: Could you provide some more information please about the proposed merger and the commercial significance of Perpetuus in terms of its size (number of employees and annual turnover), its sites in the UK and the nature of its business/products?
A1: Perpetuus Advanced Materials are a producer of Surface Modified Graphenes (SMGs) based in South Wales. Perpetuus have three sites in the UK (Swansea, Newport and Ammanford) with a 2020 turnover of £479,001. We believe that there are currently 14 employees.
Q2: What might be relevant national security considerations in this particular case?
A2: The Secretary of State has reviewed the evidence presented to him and believes that the public interest test of National Security has been met. Surface Modified Graphenes can be used in a number of sensitive sectors that can cause a rise to national security concerns.
Q3: What type of business is Taurus and is any information available about Dr Zhongfu Zhou?
A3: Taurus International Limited is a private limited company with its nature of business defined as ‘engineering design activities for industrial process and production’. Dr Zhongfu Zhou is an associate of Perpetuus Advanced Materials and is listed on their website.
Q4: What does it mean that Dr Zhou or Taurus propose to acquire Perpetuus (as stated in the EM)? Is there some uncertainty about who is proposing the takeover?
A4: A current lack of information means that the public interest intervention notice and pre-emptive action order were drafted to capture the investment prior to any terms being released.
Q5: Is there some more information available about the CMA investigation process – with whom will the CMA consult?
A5: The CMA have been instructed by the Secretary of State to begin a Phase 1 investigation under the Enterprise Act 2002. The CMA will publish an invitation to comment seeking third party views on competition and public interest issues and will complete a report on jurisdictional and competition issues, which are binding on the Secretary of State, and pass on a summary of representations received on public interest matters. It is for the Secretary of State to decide whether to accept undertakings from the parties in lieu of a referral to a Phase 2 investigation.
If the matter is progressed to a Phase 2 investigation, the CMA will appoint a Phase 2 Inquiry Group, which will conduct a more detailed investigation taking views from interested parties such as the government. The Phase 2 Inquiry Group will report to the Secretary of State making recommendations on the public interest issues.
24 September 2021