THE sale of Carter Holt Harvey’s Pinepanels sites in Mount Gambier is now likely to proceed amid the national competition watchdog giving the transaction the green light.
The looming multi-million dollar sale will be the biggest shake-up in the Mount Gambier timber manufacturing sector for some decades.
Up to 180 workers at CHH’s White Avenue and Lakeside sites will be caught up in the sale to the Borg Group, which is head-quartered in New South Wales.
The Australian Competition and Consumer Commission (ACCC) has announced it will not oppose the sale of the two sites to the burgeoning timber manufacturer.
The ACCC is also investigating the looming sale of CHH’s Jubilee Highway sawmill to forestry owner OneFortyOne Plantations, which is reported to be around $150m.
According to a statement, the ACCC considered the effect of the proposed acquisition on the supply of raw particleboard, value-added particleboard and particleboard flooring.
“The ACCC’s review focused on whether Borg would face sufficient competition and continue to have an incentive to sell raw and value-added particleboard to customers, particularly its downstream competitors,” ACCC commissioner Roger Featherston said.
As part of the 55-day investigation, the ACCC spoke to customers, suppliers and competitors of Borg and CHH Panels.
“While some parties were opposed, that view was not widespread and several, including some customers, were supportive of the proposed acquisition,” Mr Featherston said.
He said the investigation found Borg would continue to face competition in the supply of raw and value-added particleboard from other providers.
“Therefore, we consider the increased scope and vertical integration of Borg’s operations will be unlikely to substantially lessen competition,” Mr Featherston said.
The ACCC also took into account the potential entry of new suppliers of raw particleboard, most notably the feasibility study OneFortyOne Plantations is undertaking for a new $200m particleboard mill in the Green Triangle.
Borg primarily produces medium density fibreboard products, but also manufactures and supplies low pressure melamine commodity particleboard and decorative particleboard from its plants in New South Wales.
