The European Commission has opened an in-depth investigation to assess the proposed acquisition of Trimo, arhitekturne rešitve, d.o.o. by Kingspan Group plc under the EU Merger Regulation.
The Commission is concerned that the proposed transaction may reduce competition and lead to price increases in the market for mineral fibre sandwich panels in a number of Member States and the UK.
Kingspan and Trimo are both leading companies in the market for mineral fibre sandwich panels, which are used for the construction, renovation and insulation of a variety of industrial and commercial buildings.
The Commission's initial investigation revealed that Kingspan and Trimo compete head-to-head in the sale of mineral fibre sandwich panels in a number of countries in Europe. At this stage, the Commission is concerned that the proposed transaction could significantly reduce competition for mineral fibre sandwich panels in Czechia, Denmark, France, Hungary, Slovakia, Slovenia and the UK.
In each of these countries, Kingspan and Trimo would hold high combined market shares, both offering high quality products and services while facing limited competition from suppliers able to offer products and services of a comparable quality.
Moreover, in most of these countries the remaining competitors would be significantly smaller than the merged entity. The proposed transaction would thus remove an important competitive constraint for both of them.
In addition, the market for mineral fibre sandwich panels seems to be characterised by relatively high barriers to entry and expansion. These barriers relate notably to the necessity to have a sufficiently broad range of quality products that can obtain and maintain all necessary national and international certifications. The market investigation did not reveal any meaningful entry.
The Commission will now carry out an in-depth investigation into the effects of the proposed transaction to determine whether it is likely to significantly impede effective competition. ■