Merger of Tempru Ltd. and Plastgerð Suðurnesja Ltd.

The Competition Authority has been reviewing the merger of Tempra Ltd. and Plastgerð Suðurnesja Ltd. Both companies are engaged in the manufacture and sale of polystyrene boxes and polystyrene insulation. Styrofoam boxes are primarily used for transporting fresh fish, while Styrofoam insulation is mainly used in house building.

This concerns a horizontal merger where Tempra Ltd. is acquiring all the shares in Plastgerð Suðurnesja Ltd. Following an investigation and having regard to the evidence in the case, the Competition Authority has concluded that the merger would result in the creation of a very strong company with an almost monopolistic position in the market for the production and sale of polystyrene boxes on the one hand, and the market for the production and insulation on the other hand. Furthermore, the merger would lead to a significant change in market structure, as an important competitor would be removed from the market. The merger would therefore involve a serious distortion of competition and would be likely to cause harm to customers.

The merging parties submitted proposals for conditions to remedy any competition concerns that might arise from the merger. The Competition Authority is of the opinion that these proposals would not be sufficient to prevent the merger's anti-competitive effects. The Authority therefore considers it unavoidable to annul the merger.