Guala Closures Australia Pty Ltd - proposed acquisition of Metal screwcap assets of ASA-DGS Pty Ltd

Market definition

The ACCC considered the proposed acquisition in the context of the national market for the supply of metal screwcap wine closures.

Competition analysis

The ACCC formed the view that the proposed acquisition was unlikely to result in a substantial lessening of competition in the relevant market. Factors informing this conclusion included:

- the existence of alternative suppliers that would continue to compete with the merged entity, including both independent importers and domestic manufacturers;

- the competitive threat of imports was likely to constrain the merged entity as barriers to importing were low and imported metal screwcap wine closures were an effective substitute for the merger parties' products;

- barriers to entry and expansion in the supply of metal screwcap wine closures were not insurmountable, as evidenced by the entry of importers and domestic producers since 2000;

- larger customers possessed countervailing power, including the ability to sponsor new entry into the market.