Brussels, 03/09/2015 (Agence Europe) - On Wednesday 2 September, the Commission opened an in-depth investigation into the acquisition by Mondi of two industrial packaging factories from Walki. Mondi is a vertically integrated packaging and paper manufacturer and it also operates several factories across Europe to produce extrusion coating products, used for example for food wrapping, insulation material or envelopes.
The factories which Mondi hopes to buy from Walki also manufacture extrusion coating products. Extrusion coating is a process in which a molten resin is added to a substrate material, such as paper. This technique results in a strong and moisture-resistant foil with a large number of uses. The two companies are currently fierce rivals on these markets.
The Commission's initial investigation showed that the planned transaction could greatly reduce the competitive pressure on Mondi. The remaining competitors in the market would have considerably lower production capacity than the merged entity and may not be able to match its product offering or proximity to key customers. The Commission therefore has concerns that customers would have less choice and there could potentially be an increase in prices for the products concerned. It now has until 18 January of next year to determine whether its concerns are justified. (Élodie Lamer)