On December 3, 2019, the Commission approved German battery maker Varta AG (“Varta AG”) as a suitable purchaser of assets divested by US-based rival Energizer in its acquisition of U.S. consumer products company Spectrum Brands’ batteries and portable lighting business. In a separate decision on the same day, the Commission also cleared Varta AG’s acquisition of the divested Varta-branded assets subject to behavioral remedies.
The decisions come almost one year after the Commission’s clearance in December 2018 of Energizer’s purchase of Spectrum Brands’ batteries and portable lighting business, which was conditional on Energizer divesting Spectrum’s Varta-branded business for household and specialty batteries, chargers, and portable lighting in Europe, the Middle-East, and Africa.
After Energizer’s notification of Varta AG as the suitable purchaser of its divestment business, the Commission voiced concerns that Varta AG may have an incentive to foreclose customers in the market for wholesale supply of hearing aid batteries to battery brands. While Varta AG is a major manufacturer and wholesale supplier of hearing aid batteries, the divested Varta-branded business is a leading downstream supplier of branded hearing aid batteries to the mass retail channel.
The Commission therefore feared that Varta AG may have an incentive to favor supplies to its own future downstream business and raise prices for, or otherwise disadvantage supplies to, competing hearing aid battery brands. The Commission found that customers relying on Varta AG’s supply of batteries effectively lacked alternative sources of supply in the short term. To alleviate these concerns, Varta committed to supply hearing aid batteries globally to any existing or potential customers.
Given the Commission’s usual hesitance vis-à-vis behavioral remedies, its acceptance of Varta AG’s commitments is noteworthy. It coincides with the broader European initiative to develop innovative and sustainable technologies for lithium-ion batteries, known as the European Battery Alliance. Less than a month after the Commission’s decisions, Varta AG announced it intended to use the cash flow from the acquired divestment business to fund the expansion of its lithium-ion production.
The approval of Varta’s acquisition also closely coincides with the Commission’s decisions, under State aid rules, not to raise objections against State funding for a pan-European research and innovation project in the lithium-ion batteries sector, which were issued on December 9, 2019.
 Energizer/Spectrum Brands (Battery and Portable Lighting Business) (Case COMP/M.8988), Commission decision of December 11, 2018.
 VAG/Varta (Consumer Battery, Chargers and Portable Power and Lighting Business) (Case COMP/M.9449), Commission decision of December 3, 2019. In 2002, Varta AG had sold its Varta-branded consumer batteries business to Rayovac (now Spectrum Brands), see, e.g., https://investor.spectrumbrands.com/news- releases/news-release-details/rayovac-and-leading-european-based-battery-maker-varta-announce. Varta AG’s current acquisition of the Varta-branded consumer batteries business from Energizer reunites the Varta-branded consumer batteries business with the Varta AG group.
 The specific conditions remain unknown pending the Commission’s publication of the non-confidential version of its decision.
 See Varta AG corporate news, January 2, 2020, available at: https://www.varta-ag.com/varta-ag-successfully-completes-acquisition-of-varta-consumer- batteries-business-from-energizer/?lang=en.
 The project qualifies as an Important Project of Common European Interest (“IPCEI”). IPCEI comprise innovative research projects that often entail significant risks, and require joint, well-coordinated efforts and transnational investments by public authorities and industries from several Member States. IPCEI have been introduced in 2017 under the renewed EU Industrial Policy Strategy.
 See Commission decisions in cases SA.54793 (Belgium), SA.54801 (Germany), SA.54794 (France), SA.54806 (Italy), SA.54808 (Poland), SA.54796 (Sweden) and SA.54809 (Finland), not yet published.