Amcor’s proposal to takeover rival packaging company Aperio could come at the cost of “hundreds of Australian jobs”, the Australian Manufacturing Workers Union (AMWU) has warned the Australian Competition and Consumer Commission (ACCC).
[Image, right: An Amcor beverage cans manufacturing line.]
“We see the move by Amcor as one of eliminating a competitor rather than the acquisition of an asset to benefit the market,” said AMWU National Print Division secretary, Lorraine Cassin.
“Amcor has ample capacity in the flexible packaging having increased capacity in Asia. We do not see that the acquisition of Aperio would lead to increased or more effective competition resulting in lower prices for consumers or business, or better or more timely delivery of services.”
Cassin made a submission to the ACCC regarding a review of Amcor’s proposed merger with Aperio.
According to Cassin and the AMWU, a takeover of Aperio would see Amcor’s market share grow to 43%, which is more than double the other two players in the market.
“This level of market concentration is likely to limit competitive pressure in the market. We believe diversity needs to be retained in the packaging sector,” said Cassin.
“The synergies and savings through cost reduction and redundancies when combined with market concentration would allow excess profits to be earned given the lack of discipline from market forces.”
Cassin is concerned about the ‘intrusion of private equity’ not being ‘a good experience for AMWU members, after Aperio was acquired by private equity firm Catalyst in 2005.
“The structure of debt loading by private equity has resulted in several companies foundering and our members left out of work,” she said.
According to Packaging Business Review, the ACCC is currently checking whether Amcor’s takeover of Aperio will lessen competition in the market.