Adrad Pty Ltd - proposed acquisition of Natra Group Ltd
Type of assessment
Informal Review
Reference
24498
Acquirer(s)
Adrad Pty Ltd
Target(s)
Natra Group Ltd
Industry
Automotive radiator manufacturing
Summary
Adrad Pty Ltd - acquisition of Natra Group Ltd
Outcome of assessment
Not opposed
Total review days *
34
Commenced public review
29th May 2006
Date completed
8th August 2006
Market definition
The key markets were:
- the national market for the wholesale supply of radiators to the automotive aftermarket. Given the level of imports into the automotive aftermarket as discussed below, the ACCC did not need to determine whether suppliers of radiators to motor vehicle manufacturers (who largely do not currently supply the aftermarket) would be likely to significantly constrain the merged business; and
- the national market for the wholesale supply of industrial radiators to the aftermarket (equipment using industrial radiators is mostly imported and, in any case, local equipment manufacturers are likely to be able to import radiators).
Competition analysis
Automotive radiators
The proposed merger will increase concentration in the automotive radiator supply aftermarket. However, imports of non-genuine and original equipment are likely to constitute a competitive constraint on the merged business.
Regarding the repair of radiators for which complete assemblies are currently not available for import, imports of radiator cores and other Australian manufacturers of radiator cores are likely to restrain the actions of the merged business.
Industrial radiators
The acquisition would increase concentration in the national aftermarket for the wholesale supply of industrial radiators. However, competitive constraints are likely to exist in the form of:
- original equipment manufacturers, who import genuine parts;
- parts dealers relying upon second hand parts and imports of genuine and non-genuine radiators; and
- to a lesser degree, the remaining small industrial core manufacturers (that are likely to be able to continue to supply repairers).
Vertical issues
The merged entity will be affiliated with a significant proportion of radiator repairers. However, as both Natra and Adrad are already affiliated with repairers, the merger is unlikely to alter their ability to deal preferentially with their affiliated repairers.
Review timeline
Date
Event
29th May 2006
ACCC commenced assessment under Merger Review Process Guidelines.
30th May 2006
ACCC requested further information from Adrad. ACCC timeline suspended.
6th June 2006
ACCC commenced market inquiries.
6th June 2006
ACCC requested further information from Adrad.
7th June 2006
ACCC received response to information request dated 30 May.
9th June 2006
ACCC received response to information request dated 6 June. ACCC timeline recommenced.
21st June 2006
Closing date for submissions from interested parties.
11th July 2006
ACCC requested further information from Adrad. ACCC timeline suspended.
19th July 2006
ACCC received further information from Adrad. ACCC timeline recommenced.
9th August 2006
ACCC announced decision not to oppose.
* Total Review days = Total business days less public holidays and time during which the review was suspended.
