The Competition Commission of Pakistan (CCP) has approved Lotte Chemical Pakistan Limited’s proposed acquisition of a shareholding in Engro Polymer & Chemicals Limited from Engro Corporation Limited.

The approval followed a Phase-I competition assessment under the Competition Act, 2010, with the regulator concluding that the transaction is unlikely to significantly reduce competition in Pakistan’s chemical industry.

Lotte Chemical Pakistan manufactures purified terephthalic acid (PTA), a raw material used to produce polyester and polyethylene terephthalate (PET). Engro Polymer manufactures polyvinyl chloride (PVC), caustic soda, hydrogen peroxide, and other chlor-alkali products.

The CCP examined the markets for PVC, caustic soda, and hydrogen peroxide, treating Pakistan as the relevant geographical market.

The regulator found that Lotte Chemical does not operate in these markets. Neither the company nor its associated or group companies purchases products from Engro Polymer, meaning the proposed acquisition would not create direct competition or supply-chain overlap between the two businesses.

Engro Polymer is Pakistan’s only domestic PVC manufacturer, although imports provide competition in the market. In the caustic soda and hydrogen peroxide markets, the company faces competition from other suppliers.

The CCP also noted that the proposed transaction would change Engro Polymer’s ownership and control without directly increasing its production capacity, sales, or output.

Based on its assessment, the commission concluded that the acquisition was unlikely to substantially reduce competition, create barriers to market entry, or strengthen a dominant market position. It therefore authorized the transaction under Section 31(1)(d)(i) of the Competition Act, 2010.

The approval clears the regulatory competition review of the proposed transaction. The announcement did not specify the size of the stake being acquired or the transaction’s financial value.