Glatfelter Lydney Ltd / Metallised Products Ltd

OFT closed case: Anticipated acquisition by Glatfelter Lydney Ltd of Metallised Products Limited.

Affected market: Manufacture and supply of metallised paper

No. ME/3369/07

Please note that the full text of the decision can be downloaded by using the link on the right. What follows are extracts regarding the parties, the transaction, jurisdiction, third party views, assessment and decision.

The OFT’s decision on reference under section 33(1) given on 20 November 2007. Full text of decision published 10 November 2008.

Please note that square brackets indicate figures or text which have been deleted or replaced at the request of the parties for reasons of commercial confidentiality.


Glatfelter Lydney Ltd (Glatfelter) is a UK subsidiary of P.H. Glatfelter Company, a global manufacturer of specialty papers and engineered products. Its products include vacuum coated products (also referred to as metallised products), such as metallised paper and film that it manufactures at its facility in Gernsbach, Germany.

Metallised Products Limited (MPL) is active in the production and sale of metallised papers which it produces in Caerphilly, UK. In the year ended 31 March 2007, MPL’s UK turnover was £2.7 million.


Glatfelter intends to acquire MPL. A satisfactory Merger Notice was submitted on 24 October 2007. The statutory deadline expires on 20 November 2007.


As a result of this transaction, Glatfelter and MPL will cease to be distinct within the meaning of section 26(1) of the Act. The parties overlap in the supply of metallised paper in the UK with a combined share of supply exceeding 25 per cent. Thus, the share of supply test in section 23 of the Enterprise Act 2002 (the Act) is met. The OFT therefore believes that it is or may be the case that arrangements are in progress or in contemplation which, if carried into effect, will result in the creation of a relevant merger situation.


There was no response to the OFT's Invitation to Comment. The majority of third parties (both customers and competitors) contacted by the OFT were unconcerned. The only concern raised was in relation to the manufacture and supply of metallised paper for the brewing industry which has been addressed above.


This proposed merger relates to the manufacture of metallised products, in particular metallised paper, where the merging parties overlap.

The question whether the market for metallised products should be segmented on the basis of base material (paper, film, cartonboard or textiles) or end use applications (for examples labels or packaging) can ultimately be left open as the proposed transaction raises no competition concerns even in the event of narrow market definitions. The relevant geographic scope is at least EEA (if not wider) as the merging parties each supply to different EEA countries from a single factory in Germany (Glatfelter) and the UK (MPL).

The merging parties estimate their combined market share in metallised paper in Europe to be [20-30] per cent (by volume) increment [10-20] per cent. The three next largest competitors have estimated market shares between 8 and 14 per cent. Post-merger, the OFT believes there will be at least five sizeable credible competitors that will continue to impose sufficient competitive constraint on the merged entity in the supply of metallised products, including metallised paper for labels for the beverage and brewing industry.

In addition, the merged entity will continue to face competition from producers of alternative types of materials. The OFT believes, on the basis of the nearly unanimous responses from customers, competitors and independent market research that other processes and alternatives will continue to offer some constraint.

Consequently, the OFT does not believe that it is or may be the case that the merger may be expected to result in a substantial lessening of competition within a market or markets in the United Kingdom


This merger will therefore not be referred to the Competition Commission under section 33(1) of the Act.

Published 20 November 2007