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Fletcher Steel, CAH get acquisition nod

By Phil Boeyen, ShareChat Business News Editor

Wednesday 21st March 2001

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The Commerce Commission has cleared Carter Holt's (NZSE: CAH) purchase of the Tasman Mill from Norske Skog and has also approved Fletcher Steel's acquisition of Steel and Tube (NZSE: STU).

In the Carter Holt decision the Commerce Commission says although the purchase of the Tasman Mill would give the company a large market share, it would not equate to market dominance.

"Pulp products are traded internationally in large quantities. In general terms, the factors preventing dominance in New Zealand markets are the ability of CHH customers to import products, the ability of CHH suppliers to export products and, in some markets, the countervailing power of customers or suppliers."

In the case of Fletcher Steel the Commission says it had cleared a previous application in 1999 but the acquisition did not go ahead and the clearance had expired.

The Commission's John Belgrave says much of the information in the previous decision was applicable to the present application.

"The Commission analysed competition in those markets and found some changes had occurred including some of the smaller competitors expanding their operations, but found that these changes would not alter its previous decision to give a clearance" he says.

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