Environmental Plastics Pty Ltd - proposed acquisition of Superior Pak plastics business

Summary

Environmental Plastics Pty Ltd proposed to acquire the plastics business of Superior Pak.

Market definition

The ACCC assessed the effects of the proposed acquisition in the context of national markets for the supply of:

- 2-wheel mobile garbage bins (MGBs);
- 4-wheel MGBs;
- kitchen tidies / organics; and
- industrial bin lids.

The ACCC considered that the relevant markets may include the supply of plastic bin products more generally, because it may be that manufacturers are able to switch quickly between manufacturing the above products without significant investment. However, given its findings on the basis of the narrower markets listed above, it was not necessary to form a definitive view on market definition.

Competition analysis

The ACCC considered that the proposed acquisition was unlikely to substantially lessen competition in any relevant market.

The ACCC considered that the merged entity would continue to be competitively constrained by Mastec, a local manufacturer of MGBs, and a number of smaller competitors in the market who import plastic bin products, and that manufacturers engaged in injection moulding for other industries would be capable of expanding their operations into the supply of plastic bin products. The ACCC also considered that local government councils, being the largest customers of 2-wheel MGBs, may have some countervailing power through their ability to support new entry or expansion of suppliers in that market.