EUROPEAN COMMISSION DG Competition

Only the English text is available and authentic.

REGULATION (EC) No 139/2004 MERGER PROCEDURE

Article 6(1)(b) NON-OPPOSITION Date: 29/06/2022

In electronic form on the EUR-Lex website under document number 32022M10717

EUROPEAN COMMISSION

Brussels, 29.6.2022 C(2022) 4690 final

PUBLIC VERSION

In the published version of this decision, some information has been omitted pursuant to Article 17(2) of Council Regulation (EC) No 139/2004 concerning non-disclosure of business secrets and other confidential information. The omissions are shown thus […]. Where possible the information omitted has been replaced by ranges of figures or a general description.

KKR & Co. Inc. 30 Hudson Yards NY 10001 New York, United States of America

PAI Partners 232 rue de Rivoli 75054 Paris Cedex 01 France

British Columbia Investment Management Corporation 750 Pandora Avenue Victoria BC, V8W 0E4 Canada

1 OJ L 24, 29.1.2004, p. 1 (the ‘Merger Regulation’). With effect from 1 December 2009, the Treaty on the Functioning of the European Union (‘TFEU’) has introduced certain changes, such as the replacement of ‘Community’ by ‘Union’ and ‘common market’ by ‘internal market’. The terminology of the TFEU will be used throughout this decision.

2 OJ L 1, 3.1.1994, p. 3 (the ‘EEA Agreement’).

Commission européenne, DG COMP MERGER REGISTRY, 1049 Bruxelles, BELGIQUE Europese Commissie, DG COMP MERGER REGISTRY, 1049 Brussel, BELGIË

Tel: +32 229-91111. Fax: +32 229-64301. E-mail: COMP-MERGER-REGISTRY@ec.europa.eu.

Dear Sir or Madam,

1.(1) On 23 May 2022, the European Commission received notification of a proposed concentration pursuant to Article 4 of the Merger Regulation by which KKR & Co. Inc. (‘KKR’, US), PAI Partners S.à.r.l. (‘PAI Partners’, France) and British Columbia Investment Management Corporation (‘BCI’, Canada) intend to acquire joint control over Refresco Europe B.V. (‘Refresco’, the Netherlands; or the ‘Target’) by way of a purchase of shares (the ‘Transaction’). KKR, PAI Partners, BCI (‘the Notifying Parties’) and Refresco are together referred to as the ‘Parties’. Refresco is currently jointly controlled by PAI Partners and BCI.

THE PARTIES

2.(2) KKR is a global investment firm that offers alternative asset management and capital markets and insurance solutions. Among others it currently controls the packaging solutions provider Petainer.

3.(3) PAI Partners is active in the management of a number of funds investing in the business services, distribution, food & consumer, general industrials, and healthcare sectors.

4.(4) BCI is an agent of the Government of British Columbia investing on behalf of public sector clients across a range of asset classes, including fixed income, public equities, private equity, infrastructure, renewable resources, real estate and commercial mortgages.

5.(5) Refresco is global player active in the production and bottling of a large variety of non-alcoholic beverages for private labels belonging to retailers and for brand owners under contract manufacturing.

THE OPERATION AND THE CONCENTRATION

6.(6) Pursuant to the Sale and Purchase Agreement, KKR (via a special purpose vehicle indirectly wholly owned by funds, investment vehicles and/or separately managed accounts advised and/or managed by subsidiaries of KKR) acquires 100% of Sunshine Equity B.V.'s shares (Sunshine Equity B.V. is the holding company of Refresco). KKR or one of its direct or indirect parent companies (‘EquityCo’) will issue Securities to entities controlled by PAI Partners and BCI (to a newly incorporated SPV, the ‘Co-Investor’). Post-Transaction, an entity indirectly controlled by KKR and the Co-Investor will hold approximately 70% and 30%, respectively, of all Securities in EquityCo.

3 Publication in the Official Journal of the European Union No C 218, 2.6.2022, p.15.

7.(7) Overall, post-Transaction, there will be three shareholders in EquityCo: KKR Pegasus Aggregator LP (indirectly solely controlled by KKR), (ii) the Co-Investor (jointly controlled by PAI Partners and BCI) and (iii) Management.

8.(8) The supervisory board of EquityCo will be the main decision-making body of Refresco, in particular with respect to key strategic and operational decisions. KKR will be entitled to appoint […] directors to the board, the Co-Investor will be entitled to appoint […] directors. Decisions of the board will require the approval of […] of the votes of members of the board and a KKR director, so that KKR will have veto rights over […] of the board. In addition to KKR’s approval, certain matters ([…]) also require prior approval of the Co-Investor. Accordingly, PAI Partners and BCI, through the Co-Investor, will have veto rights over strategic business decisions. In the event of a deadlock at the Board, customary resolution provisions will apply, including customary escalation procedure, […]. The deadlock mechanism will not allow one of the Notifying Parties to […] in case of a deadlock. Management will only receive minority shareholding protection rights that will not allow them to veto decisions. KKR, PAI Partners and BCI will therefore jointly control Refresco post-Transaction.

9.(9) Refresco is currently a stand-alone full-function company and holds all of the assets and personnel to give it an independent market presence with respect to its customers, to which turnover can be attributed. In particular, the Target has management dedicated to its day-to-day operations, personnel (including more than 11,600 employees), financial resources to perform its business (including sufficient assets amounting to over EUR […] in value). Post-Closing, the Target will continue to have a management dedicated to its day-to-day operations and will continue to have sufficient assets, personnel and financial resources. It will not take over a specific function (or indeed any function) within the business activities of its shareholders upon Closing and will not be reliant on the Notifying Parties for sales or purchases.

10.(10) Therefore, the operation constitutes a concentration pursuant to Article 3(1)(b) and Article 3(4) of the Merger Regulation.

UNION DIMENSION

11.(11) The combined aggregate worldwide turnover of the Parties is more than EUR 5 000 million (KKR: EUR […] million, PAI Partners: EUR […] million, BCI: EUR […] million, Refresco: EUR 4 241 million) and the aggregate Union-wide turnover of each of the Parties is more than EUR 250 million (KKR: EUR […] million, PAI Partners: EUR […] million, BCI: EUR […] million, Refresco:EUR […] million). The Parties do not achieve more than two-thirds of their aggregate Union-wide turnover within one and the same Member State. The notified operation therefore has a Union dimension pursuant to Article 1(2) of the Merger Regulation.

5 Form CO, paragraph 24: It is expected that executive and senior management of Refresco that currently participate in the capital of the Target will roll over approximately […]% of their cash exit proceeds net of tax and costs. Following this rollover, Management will invest in EquityCo, through a management pooling vehicle, and receive a minority shareholding in EquityCo.

6 Refresco’s turnover is consolidated in PAI Partners and BCI.

7 Refresco’s turnover is consolidated in PAI Partners and BCI.

COMPETITIVE ASSESSMENT

12.(12) The Transaction as notified does not give rise to any horizontal overlap, but does give rise to a vertical relationship between one of the portfolio companies controlled by KKR, Petainer, which is active upstream of Refresco. Specifically, Petainer is active on the market for the production and supply of PET packaging for beverage bottling. Refresco is active in the production and bottling of a large variety of non-alcoholic beverages.

13.(13) In its market investigation, the Commission sought the views of market participants by sending information requests to five competitors of Petainer and 16 customers of Petainer. The Commission received three replies. In these replies, two customers and one competitor raised certain concerns (relating to potential input foreclosure by Petainer and potential sharing of confidential information of third parties between Petainer and Refresco).

14.(14) However, on 20 June 2022, KKR informed the Commission that it had signed an SPA regarding the full sale of Petainer to Ara Partners, and that, therefore, effective 21 June 2022, Petainer would no longer be a portfolio company controlled by KKR. Therefore, KKR and the Target are no longer engaged in business activities in the same product and geographic market, or in a product market which is upstream or downstream from a product market in which one of the two is engaged.

15.(15) As a result of this operation, the vertical relationship to which the Transaction as notified would have given rise can no longer materialise at the date of this Decision. Consequently, the Commission is not in possession of any concrete elements that would hint at the existence of serious doubts as to the compatibility of the Transaction with the internal market or the functioning of the EEA Agreement.

16.(16) For the reasons set out above, the Commission has come to the conclusion that the proposed concentration does not raise serious doubts as to its compatibility with the internal market or the functioning of the EEA Agreement.

CONCLUSION

17.(17) For the above reasons, the European Commission has decided not to oppose the notified operation and to declare it compatible with the internal market and with the EEA Agreement. This decision is adopted in application of Article 6(1)(b) of the Merger Regulation and Article 57 of the EEA Agreement.

For the Commission

(Signed) Margrethe VESTAGER Executive Vice-President

8 Emails from Counsel to KKR, 20 June 2022, including signed SPA.

4