Finland moves to block Uponor-KWH pipe deal

By Richard Higgs
EUROPEAN PLASTICS NEWS

Published: March 20, 2013 8:44 am ET
Updated: March 20, 2013 8:48 am ET

Related to this story

Topics Construction, Mergers & Acquisitions, Pipe/Profile/Tubing, Extrusion

VANTAA, FINLAND — Finland's antitrust authority has moved to block a plan by two Finnish plastic pipe manufacturers Uponor and KWH Group to merge their pipe infrastructure businesses.

Last September, the two groups announced they intend to consolidate the operations of subsidiaries KWH Pipe Ltd and Uponor Infrastructure Solutions in a new joint venture called Uponor Infra Oy. They said the consolidation was prompted by intense competition and falling demand resulting from the prolonged global economic crisis.

The Finnish Competition and Consumer Authority (FCCA) has decided the merger should be prohibited. The body argued that it would bring together the country's "two overwhelmingly largest suppliers of plastic pipe systems", reducing competition significantly in the infrastructure pipe market.

FCCA said the move is likely to result in increased pipe prices and raise infrastructure building costs. It had little choice but to oppose the merger as the two companies had offered no proposal mitigating its effect on competition, the authority declared.

Under Finland's Competition legislation the FCCA decision must be referred to the Market Court, a special court that hears market law, competition and public procurement cases. The court can prohibit or approve the merger or impose conditions on its go-ahead.

Uponor and KWH groups stated that they would support their case at the Market Court and still intend to continue with the merger plan. The court has until 25 May 2013 to reach a decision in the case.

Under the plan, Uponor would own a majority 55.3 percent stake and KWH Group would have a 44.7 percent share in the joint venture which would focus on supplying infrastructure pipe systems mainly to northern Europe.

The firms' infrastructure businesses produce pipe used to convey rainwater, sewage, pressurised water and cable systems for construction and municipal authority customers.

The proposal would also see Uponor acquire the crosslinked polyethylene (PEX) pipe production operations of Ulvila-based KWH Pipe which would be integrated with Uponor's building solutions organization.

The partnership between Vaasa, Finland-based KWH and Uponor of Vantaa, Finland want to benefit from increased efficiency and economies of scale as a result of the merger.


Comments

Finland moves to block Uponor-KWH pipe deal

By Richard Higgs
EUROPEAN PLASTICS NEWS

Published: March 20, 2013 8:44 am ET
Updated: March 20, 2013 8:48 am ET

Post Your Comments


Back to story


More stories

Image

China's biggest fuel tank maker getting a US foothold

April 23, 2014 4:41 pm ET

The majority owner of China's biggest fuel tank maker is expanding its global automotive footprint with the acquisition of the fuel tank unit of...    More

Image

China's Shide Group, BASF unveil 'revolutionary' all-plastic window profile

April 23, 2014 9:10 pm ET

SHANGHAI — The PVC window profile market in Asia is expected to increase four-fold by 2025, and Chinese building products maker Dalian Shide...    More

Image

How CEO Santi is changing ITW

April 23, 2014 2:48 pm ET

Scott Santi is showing he can do more than just cut costs at Illinois Tool Works Inc.    More

Quality Vision buys ShapeGrabber

April 23, 2014 10:19 am ET

Quality Vision International Inc. of Rochester, N.Y., has purchased ShapeGrabber Inc., a maker of automated three-dimensional scanners, in a deal...    More

Image

Pregis Corp. to get new owner

April 22, 2014 11:44 am ET

The private equity owner of Pregis Corp. is selling off its North American operations for an undisclosed sum.    More

Market Reports

Market Data Book - Rankings & Lists

A one-stop download of Plastic News' exclusive annual lists and processor rankings containing essential data including sales, employees, end markets, materials and more.
EXCLUSIVE EXCEL FEATURE: full mailing address details for available plant locations.

Learn more

Thermoformed Packaging 2014 Market Review & Outlook North America

This in-depth report provides analysis and discussions of economic and political conditions, market trends, legislative/regulatory activity impacting supply and demand, business opportunities and threats, materials pricing, manufacturing technology, as well as strategies being implemented by thermoformed packaging companies. In addition, there are reviews of 25 leading thermoformers in the packaging segment, assessing their growth initiatives and performance metrics over 10 years.

Learn more

Mold Making and Tooling Review and Outlook 2014 North America

This report provides in-depth analysis of the mold and toolmaking market for North America, including discussions of trends, opportunities, threats, the latest developments in production and labor and equipment trends impacting moldmakers.

Learn more

Upcoming Plastics News Events

May 6, 2014 - May 8, 2014Plastics in Medical Devices 2014

May 12, 2014 - May 12, 2014Plastics News Brazil Pharma Summit

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

February 3, 2015 - February 7, 2015Plastics News Executive Forum 2015

More Events