European Commission gives approval for Amcor and Bemis merger
The approval is conditional on the divestment of Bemis’ medical packaging business in Europe to address the E.C.’s concerns over competition.
Australian packaging company Amcor has been given conditional approval for its US$6.8 billion merger with U.S. flexible packaging company Bemis by the European Commission (EC).
The EC has approved the merger under the EU Merger Regulation, with the approval conditional “on the divestment of Bemis’ medical packaging business in Europe.” This would cover three plants in the UK and Ireland, which generate approximately US$170 million annual revenues in healthcare packaging.
In a statement, the Commission said it examined the transaction in markets for flexible packaging for medical use and food products in the European Economic Area (EEA) – where the activities of Amcor and Bemis overlap – and that both Amcor and Bemis were the “most significant players” in the flexible packaging for medical use in that region. “The merged entity would have created a player three times larger than the second largest supplier, on a fragmented market with many small suppliers,” the Commission said. “The offer to divest Bemis’ entire medical packaging business in the EEA fully addressed these concerns.”
“The process toward securing required antitrust clearances and other regulatory consents in all jurisdictions, which are conditional to closing, have either been completed or are progressing in line with expectations,” Amcor said in a statement.
Amcor first announced its plan to absorb U.S. rival Bemis, which is headquartered in Neenah, Wis., in August 2018. The deal is designed to give Amcor deeper access to the rigid plastic packaging business in North America.
The companies now expect to complete the deal in the second quarter of 2019.