The Australian Competition & Consumer Commission (ACCC) has announced it will not oppose the merger between printing companies PMP Ltd (ASX:PMP)
ACCC Chairman, Rod Sim, says that although the merger will likely “lessen competition”, it won’t “substantially” lessen competition.
The ACCC took into account the fact that market conditions have changed since it last considered this particular merger back in 2001 (16 years ago).
In particular, the ACCC notes there has been a “significant reduction in demand for magazine printing and there is excess capacity in the industry”.
In addition, the competition regulator took into account the fact that another printing company, the IVE Group (ASX:IGL)
has recently expanded through acquisitions and winning major tenders. IVE is expected to constrain PMP and IPMG after they have merged.
PMP posted a net profit of $185,000 at 30 June 2016.