On Wednesday 24 November, the European Commission opened an in-depth investigation to assess the proposed acquisition of Recticel by Greiner under EU merger regulations. The Commission is concerned that this proposal could reduce competition in the market for the supply of certain technical foam products.
Greiner (Austria) and Recticel (Belgium) are the leading producers and suppliers of technical foams in Europe. Technical foams are polyester-based or polyether-based flexible foams with a wide range of uses and applications in various industries. They are an important input for producers of automotive components.
The Commission’s initial investigation identified a number of preliminary concerns regarding the combination of Greiner’s and Recticel’s business in this field.
At this stage, the Commission is concerned that the proposed transaction may lead to reduced choice and higher prices for technical foam rolls, noise, vibration and harshness reducing foams as well as filter foams in a number of local European markets.
For each technical foam product mentioned, the merged entity would have a significant combined market share in already concentrated markets, particularly locally in central European countries such as Austria, Germany, Poland, and the Czech Republic. Greiner and Recticel are among the very few suppliers that offer the full range of properties and specifications of technical foam and have an extensive geographical footprint.
Customers in the automotive industry often rely on both companies due to their reputation, wide range of products and approval by automotive original equipment manufacturers.
The Commission will now carry out an in-depth investigation to determine whether its initial competition concerns are confirmed. Link to the case: https://bit.ly/3l3pT2g (Original version in French by Lionel Changeur)