Union says Amcor acquisition would cause job losses

By Kate Tilley
Correspondent

Published: February 23, 2012 6:00 am ET

Related to this story

Topics Mergers & Acquisitions, Packaging, Film & Sheet

SYDNEY, AUSTRALIA (Feb. 23, 1 p.m. ET) — A major Australian trade union has told Australia’s competition watchdog that Amcor Ltd.’s proposed acquisition of flexible packaging supplier Aperio Group Australia Pty. Ltd. should not go ahead because it will cause significant job losses.

The Australian Competition and Consumer Commission (ACCC) is investigating whether global packaging supplier Amcor’s proposed acquisition will lessen competition in the market.

Even if Melbourne-based Amcor gets ACCC approval to proceed with the purchase, it will have to outbid other buyers that have shown interest in taking over Melbourne-based Aperio.

ACCC released a statement Feb. 23 seeking further information on “certain competition issues” that have so far arisen from its review. Stakeholders have until March 8 to make further submissions. ACCC’s final decision will be deferred to March 29.

A final report was initially due for release Jan. 25 but has been delayed three times.

The Sydney-based Australian Manufacturing Workers Union (AMWU) represents more than 100,000 workers in the metal, vehicle, food, technical, automotive, print and packaging manufacturing industries. It has members at both Amcor and Aperio.

“We see the move by Amcor as one of eliminating a competitor, rather than the acquisition of an asset to benefit the market,” AMWU said in its submission to ACCC

“We do not see the acquisition of Aperio would lead to increased or more effective competition, resulting in lower prices for consumers or businesses, or better or more timely delivery of services. We see the likely outcome as job losses for Aperio members.”

The submission said Aperio employs about 550 employees, so job losses will have “significant direct and flow-on effects.”

It warned cost reductions and redundancies will earn Amcor excess profits. “We are not convinced any import pressures will provide those competitive pressures.”

AMWU said there are four main competitors in Australia’s plastic bag and film manufacturing market. Amcor has a 22 percent to 25 percent market share; Aperio 16 percent to 18 percent; Melbourne-based Sealed Air Australia (Holdings) Pty. Ltd. 16 percent; and Melbourne-based Innovia Films (Asia Pacific) Pty. Ltd. three percent.

“Any acquisition by Amcor of Aperio would see its market share rise to 38 percent to 43 percent; more than double the other two players.” The union said any player with more than 40 percent market share will have the ability to exert “upward pressure” on prices.

“We believe diversity needs to be retained in the packaging sector so competitive pressures are retained,” AMWU’s submission said.


Comments

Union says Amcor acquisition would cause job losses

By Kate Tilley
Correspondent

Published: February 23, 2012 6:00 am ET

Post Your Comments


Back to story


More stories

Image

Optical disc molder OEM getting into micromolding with acquisition of CDA

August 29, 2014 11:24 am ET

Optical disc replicator and molder Optical Experts Manufacturing Inc. of Charlotte, N.C., has expanded its core business and entered new high...    More

Image

Tighter resin prices leading to price hike for PE film

August 29, 2014 11:13 am ET

One of North America's largest film makers is pushing through a polyethylene price increase due, in part, to the tight resin market.    More

Polish injection molder Teknorubber up for sale

August 29, 2014 9:14 am ET

Polish plastic parts maker Teknorubber has been put up for sale following its insolvency filing in March 2014. The company is to be auctioned through ...    More

Image

Obituary: Frank Nissel, Welex Inc. co-founder

August 28, 2014 1:01 pm ET

Friends, family and business acquaintances will remember Nissel as an urbane, outgoing machinery executive, an expert on extrusion, a globalist who...    More

Image

Pregis, Sealed Air settle film-foam patent dispute out of court

August 28, 2014 1:01 pm ET

A couple of packaging companies are settling their patent fight over film-foam underlayment.    More

Market Reports

Thermoformed Packaging 2014 Market Review & Outlook North America

This in-depth report analyzes economic and market trends, legislative/regulatory activity impacting supply and demand, business opportunities and threats, materials pricing, manufacturing technology, as well as growth strategies being implemented by thermoformed packaging companies.

Learn more

Pipe, Profile & Tubing Extrusion in North America 2014

U.S. demand for extruded plastics is expected to grow by 3 percent in 2014, with PVC remaining the largest segment.

Plastic pipe will post the strongest gains through 2018, continuing to take market share from competing materials in a range of markets.

Our latest market report provides in-depth analysis of current trends and their financial impact on the pipe, profile and tubing extrusion industry in North America.

Learn more

2014 Injection Molding Industry Report

GROWTH, OPPORTUNITY IN SIGHT FOR INJECTION MOLDERS IN 2014

In the wake of the economic turbulence earlier in this decade, molders today find themselves in much better shape. Molders are gaining a competitive advantage by investing in people, equipment and seeking inroads into new markets on a global scale.

Growth in the injection molding industry is going to be driven by low financing costs and a continued move to reshore some business.

Learn more

Upcoming Plastics News Events

September 10, 2014 - September 12, 2014Plastics Caps & Closures 2014

January 14, 2015 - January 14, 2015Plastics in Automotive

February 4, 2015 - February 6, 2015Plastics News Executive Forum 2015

More Events