The Australian Competition and Consumer Commission will not intervene in the global merger of Avery Dennison Corporation and Jacksteadt Holdings GmbH.
Both companies have self-adhesive manufacturing operations and compete with each other in 12 countries, including Australia. Locally, the major competitive overlap between the companies is in the manufacture and importation of labelstock, which is used by label converters to make labels and in the importation of graphics.
As part of its investigation of the merger, the ACCC conducted market inquiries of customers and competitors and liaised with overseas competition agencies.
The ACCC noted that the merger combines the two largest domestic manufacturers of labelstock. However, customers have indicated that their ability to import, or vertically integrate their operations by manufacturing labelstock, will constrain price levels in the market post merger. In this regard the ACCC notes that imports have constituted at least 10% of the Australian market for labelstock for at least the last 3 years.
In these circumstances the ACCC concluded that the proposed acquisition is unlikely to result in a substantial lessening of competition.