The Australian Competition and Consumer Commission announced today that it will not intervene in the proposed acquisition of Metal Manufactures Energy Cables Division by Pirelli Cables Australia Limited.
The acquisition will result in two key domestic manufacturers controlling just over 80 per cent of the Australian energy cables market.
"The ACCC was concerned to discover, during market inquiries, the existence of an agreement between Metal Manufactures Limited and BICC plc (a UK based cable manufacturer which has extensive cable manufacturing facilities in the region including New Zealand, Indonesia, Malaysia, Singapore and the Philippines) which prevented BICC from competing in Australia," the ACCC Chairman, Professor Allan Fels, said today.
"The competition concerns that this agreement raised in relation to the acquisition were removed on Friday when Metal Manufactures Limited provided to the ACCC a court-enforceable undertaking that it would formally release BICC plc from the no compete provisions of the agreement and that it would not enforce against BICC plc the no compete obligations (if any) arising from any other arrangements between Metal Manufactures Ltd and BICC.
"The ACCC has concerns with the existence of this agreement in the past and is considering any issues it raises under other parts of the Trade Practices Act 1974.
"The ACCC conducted extensive inquiries in relation to this acquisition and was satisfied that the existence of the Pacific Dunlop Cables Group together with a number of smaller manufacturers/importers combined with the ability of BICC plc to compete in Australia was likely to ensure that the merger does not result in a substantial lessening of competition."
