The Commerce Commission has received an application from Bluescope Steel (NZ) Ltd (Bluescope) seeking clearance to acquire some of the assets of Pacific Steel Group’s (PSG) steel production business.
Under the proposed acquisition, Bluescope would acquire PSG’s rolling and wire mill manufacturing operations in New Zealand, along with its long steel distribution, marketing and sales operations.
Bluescope is a wholly owned subsidiary of Bluescope Steel Ltd, an ASX listed company. Bluescope Steel Ltd’s New Zealand operations include steel production and iron sand mining.
They produce a range of steel products, including slab, hot and cold rolled coil, welded steel beams, pipes and hollow sections.
PSG is a business unit of Fletcher Steel Ltd, a wholly owned subsidiary of Fletcher Building Ltd. In New Zealand, PSG comprises three businesses — Pacific Steel, Pacific Wire, and Fletcher Pacific Fiji.
PSG also produces a range of steel products, including billet, reinforcing bar and coil, wire, rod bar and rod coil.
When considering a proposed merger (or joint venture) or acquisition, the Commission must decide whether the competition that is lost in a market when two businesses merge is substantial.
The Commission will give clearance to a proposed merger only if it is satisfied that the merger is unlikely to have the effect of substantially lessening competition in a market.
A fact sheet explaining how the Commission assesses a merger application is available on the Commission’s web site at www.comcom.govt.nz/merger-assessment.