MELBOURNE, AUSTRALIA (March 29, 1:30 p.m. ET) — Australia's competition watchdog has given Melbourne-based companies Amcor Ltd. and Visy Industries Australia Pty. Ltd. the green light to go ahead with their separate acquisitions of rival plastics companies.
Global packaging supplier Amcor announced March 21 it has reached an agreement to buy Melbourne-based flexible packaging supplier Aperio Group Australia Pty. Ltd. for US$252.5 million, subject to approval from the Canberra-based Australian Competition and Consumer Commission (ACCC)
ACCC launched a public review into the proposed deal Nov. 14, 2011, and published a statement of issues outlining its preliminary competition concerns Feb.23.
But ACCC on March 27 granted Amcor unconditional approval to proceed with the purchase, saying there is still adequate market competition. In a statement, Amcor managing director and CEO Ken MacKenzie said the acquisition will likely finalize by June 30.
ACCC chairman Rod Sims said Amcor has several competitors, particularly overseas, because the packaging is generally easy to transport and import levels are increasing. “Some overseas suppliers offer Australian warehouse and distribution services to better compete with domestic suppliers. There are also Australian suppliers looking to expand,” Sims said.
In a separate determination, Melbourne-based Visy has got approval to buy the Australian and New Zealand PET and other plastics manufacturing assets of the HP group of companies after ACCC said customers have alternative options.
Visy sought permission to buy six companies - HP PET Pty. Ltd., HP PET (Australia) Pty. Ltd., HP Industries Pty. Ltd., HP Industries Services Pty. Ltd., HP Plastics (N.S.W.) Pty. Ltd. and HP Plastics (Vic.) Pty. Ltd. All the businesses went into receivership in December.
ACCC launched a public review into the acquisition on Dec. 23, published a statement of issues outlining its preliminary competition concerns Feb. 29 and released its final decision March 21.
Sims said while Visy's competitors are not as large as HP or Visy's main competitor, Melbourne-based Pact Group Pty. Ltd., smaller manufacturers can expand.
“A range of market participants are currently [or are considering] self-manufacturing their own PET and rigid plastic container requirements. This indicates many customers are likely to hold countervailing power, enabling them to bypass the merged firm and Pact,” Sims said.
