Completed acquisition by Ahlstrom Corporation of the spunlace wipes business and assets of Orlandi SpA

Affected market: Nonwoven roll goods

No. ME/2964/07

Please note that the full text of the decision can be downloaded by using the link on the right. What follows are extracts regarding the parties, the transaction, jurisdiction, third party views, assessment and decision.

The OFT's decision on reference under section 22 given on 16 May 2007. Full text of decision published 22 May 2007.

Please note that square brackets indicate text or figures which have been deleted or replaced with a range at the request of the parties for reasons of commercial confidentiality.

PARTIES

Ahlstrom Corporation (Ahlstrom) is a Finnish company active in the manufacture of a wide range of fibre-based materials.

Orlandi SpA (Orlandi) is incorporated in Italy and is active in the manufacture and supply of various nonwoven products including wipes in roll good form. The turnover in 2006 for its spunlace wipes business (to be acquired by Ahlstrom) in the EU was €[ ] and in the UK it was €[ ].

TRANSACTION

On 30 April 2007, Ahlstrom acquired from Orlandi its spunlace wipes business and assets ('the acquired business'). The parties notified the transaction on 27 March 2007. The administrative deadline is 25 May 2007 and the statutory deadline expires on 29 August 2007.

JURISDICTION

As a result of this transaction Ahlstrom and the acquired business have ceased to be distinct. The parties overlapped in the supply of nonwoven products in roll good form ('nonwoven roll goods') and have combined shares of supply in the UK in excess of 25 per cent, so the share of supply test in section 23 of the Enterprise Act 2002 (the Act) is met. The OFT therefore believes that it is or may be the case that a relevant merger situation has been created.

THIRD PARTY VIEWS

The OFT received very few responses to its request for comment on this merger. All third parties that did respond to the OFT were unconcerned.

ASSESSMENT

The parties overlapped in the manufacture and supply of nonwoven roll goods for the production of industrial and consumer wipes and for use in certain technical and medical goods applications. In relation to the manufacture and supply of nonwoven roll goods for use in certain technical and medical goods applications, their production for these uses is negligible and they do not overlap in relation to specific end uses, therefore competition concerns do not arise.

The OFT considered the supply of nonwoven roll goods for industrial wipe production separately from that for consumer wipe production. Under each frame of reference the transaction results in a relatively small increment to the merged entity's shares of supply. In addition, third parties suggested that Ahlstrom and Orlandi were not particularly close competitors. These factors, combined with the existing constraint from the remaining competitors, suggest that the merger does not give rise to competitive concerns in respect of the supply of nonwoven roll goods for the production of industrial and consumer wipes.

Consequently, the OFT does not believe that it is or may be the case that the merger has resulted or may be expected to result in a substantial lessening of competition within a market or markets in the United Kingdom.

DECISION

This merger will therefore not be referred to the Competition Commission under section 22(1) of the Act.

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