The European Commission has approved the proposed acquisition of Aluflexpack AG by Constantia Flexibles GmbH. Constantia is a global producer and supplier of flexible packaging, including plastic and aluminum-based products. Aluflexpack is a manufacturer and supplier of flexible packaging, primarily made from aluminum, for a variety of industries.

The commission showed that the parties compete in the supply of flexible aluminum packaging for various end-uses, such as human and pet food, dairy and pharmaceuticals. It found that the transaction would have reduced competition in the markets for the supply of sterilizable aluminum containers and lids for wet pet food and certain human foods (such as pâté) in the European Economic Area. In particular, the commission concluded that the deal would have resulted in very large combined market shares as well as high concentration levels in the EEA.

The commission also found that, after the acquisition, there would not be enough alternative suppliers to exert competitive pressure on the merged entity. This would have likely led to higher prices and less choice for human and pet-food producers in Europe.

The proposed remedies 

To address the commission’s competition concerns, the parties offer to divest the entirety of Aluflexpack’s wet pet and human food sterilizable business in the EEA, including all assets and personnel currently part of Aluflexpack’s production plant Omial Novi in Omiš (Croatia).

Following the positive feedback received during the market test, the commission concluded that the transaction, as modified by the commitments, would no longer raise competition concerns. This is because the divestiture of a stand-alone business fully removes the overlap between the parties’ activities, by enabling a purchaser to run the divestment business as a viable competitive force in the market on a lasting basis.

Constantia proposed to divest the business to the MTX Group, a Czech industrial trading and production holding active in flexible packaging. The commission will formalize its conclusions on the purchaser in a separate buyer-approval process.