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

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

Investment firm buys Ontario cap molder

October 23, 2014 2:01 pm ET

A company whose varied interests include food and refrigerated transportation businesses is now moving into plastic caps.    More

Image

Geist Plastics changes name to Lincoln Plastics

October 23, 2014 12:31 pm ET

Custom profile extruder Geist Plastics Inc. is changing its name to Lincoln Plastics, the company announced Oct. 23.    More

Image

Report: Private equity companies may seek to buy Bayer MaterialScience

October 23, 2014 10:56 am ET

A number of investment groups are reported to be interested buying Bayer AG's MaterialScience operation, valued at around 10 billion euros ($12.6...    More

Image

Comar merging with Convergence Packaging

October 21, 2014 5:07 pm ET

A couple of plastic packaging companies owned by private investment firm Graham Partners are merging into a single entity.    More

Image

Celanese buys conductive polymer supplier

October 21, 2014 4:31 pm ET

Materials firm Celanese Corp. has acquired most of the assets of conductive polymers maker Cool Polymers Inc. for an undisclosed price.    More

Market Reports

Plastics Recycling Trends in North America

This report is a review and analysis of the North American Plastics Recycling Industry, including key trends and statistics based on 2013 performance. We examine market environment factors, regulatory issues, industry challenges, key drivers and emerging trends in post-consumer and post-industrial recycling.

Learn more

Plastics in Mexico - State of the Industry Report

This report analyzes the $20 million dollar plastics industry in Mexico including sales of machinery & equipment, resins and finished products.

Our analysts provide insight on business trends, foreign investment, top end markets and plastics processing activity. The report also provides important data on exports, production, employment and value of plastics products manufactured.

Learn more

Plastics Caps & Closures Market Report

The annual recap of top trends and future outlook for the plastics caps & closures market features interviews with industry thought leaders and Bill Woodís economic forecast of trends in growing end markets. You will also gain insight on trends in caps design, materials, machinery, molds & tooling and reviews of mergers & acquisitions.

Learn more

Upcoming Plastics News Events

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

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

June 2, 2015 - June 3, 2015Plastics Financial Summit - Chicago 2015

September 16, 2015 - September 18, 2015Plastics Caps & Closures - September 2015

More Events