Home Business CompCom greenlights Ardagh’s acquisition of Consol

CompCom greenlights Ardagh’s acquisition of Consol

15
0

The Competition Commission (CompCom) has recommended that the Competition Tribunal approve Ardagh Group S.A.’s acquisition of glass packaging manufacturer and supplier Consol.

The merger was first announced in November 2021. At the time, Ardagh said it would pay R10.1 billion for Consol, and finance the acquisition through a combination of its cash resources, as well as by assuming Consol’s existing debt of R5.7 billion .

Read: Ardagh to buy African bottle maker Consol for R10.1 billion

However, the commission noted that the merger of Ardagh – a private glass and metal packaging manufacturing company registered in Luxembourg – and Consol raised significant public interest concerns.

Thus, the nod from the commission came with several conditions, including some aimed at empowering Consol employees and protecting the market for food jars and wide mouth jars – the latter is typically used as packaging for food items like pickles, beetroot and whole fruits.

To address the commission’s concerns around protecting the above mentioned markets, Ardagh and Consol have been tasked with continuing to supply these jar types.

Apart from having to invest in the construction of a new glass manufacturing facility, Ardagh and Consol will also have to establish a new employee share ownership program which will have a 7% shareholding in Consol.

Another employee-focused condition stipulates that Ardagh must – within a specified time – expand Consol’s existing Cullet Owner Driver Scheme.

Further conditions dictating the success of the merger include:

  • Ardagh will incur all reasonable capital expenditure, including raising necessary debt funding required to finalize the construction of the glass manufacturing facility planned by Consol.
  • Ardagh shall procure recycled glass or cullet for use in its operations in the ordinary course and will favor historically disadvantaged persons (HDPs).
  • Ardagh undertakes to support small, medium and micro enterprise customers through a reduction of minimum order quantities.
  • Consol shall increase its pre-merger procurement of cullet from small / HDP vendors.
  • Ardagh undertakes to use reasonable endeavors to introduce a new production line of glass-related products.
Previous articleVolvo invests in fast-charge EV battery co StoreDot
Next articleEmployees who claimed home office tax relief during the pandemic could end up paying more tax this year

LEAVE A REPLY

Please enter your comment!
Please enter your name here