Brussels, 24/05/2013 (Agence Europe) - Following an in-depth investigation, the European Commission gave its approval on 24 May to the proposed merger of Munksjö AB (Sweden) notified on 31 October last and the label and processing paper business of Ahlstrom Corporation of Finland in the specialty paper industry. The approval is conditional upon the divestment of Ahlstrom's abrasive paper backings and pre-impregnated paper (“PRIP”) business located at Osnabrück, Germany, in an effort to meet concerns regarding the merger's impact on competition.
The parties are the only two manufacturers of heavy weight abrasive paper backings in the European Economic Area (EEA), and the two leading players in the global market with a market share of over 80%. These two companies are also two of the three European manufacturers of PRIP resulting in an EEA-wide and worldwide (without China) market share of over 70%. The Commission had concerns that the transaction, as initially notified, would have allowed the merged entity, Munksjö Oyj, to raise prices in heavy weight abrasive paper backings, which are used in abrasive products, and PRIP, a type of décor paper used by furniture manufacturers. The Commission considers that the commitments offered by the parties effectively address these concerns.
Munksjö and Ahlstrom are committed to divesting all of Ahlstrom's heavy weight abrasive paper backings and PRIP business, including the sale of Ahlstrom's Osnabrück paper plant. Ahlstrom will, however, retain and operate one paper machine, whose business is not related to abrasive paper backings or PRIP. Ahlstrom will enter into a number of ancillary agreements with the new owner of the Osnabrück plant to ensure the continuity of its remaining operations there. Furthermore, certain utilities and their respective facilities, namely the power plant and water facilities, will be transferred to a joint venture to be jointly controlled by the new owner of the Osnabrück plant and Ahlstrom. The Commission agreed to these commitments and will ensure that they are respected. (FG/transl.fl)