The Icelandic Competition Authority approves the merger of Marel and Valka

Recently,
the Icelandic Competition Authority (ICA) has been investigating the proposed
merger of Marel Iceland ehf., a subsidiary of Marel hf., and Valka ehf. Marel
and Valka both operate in the food processing sector, manufacturing and
servicing equipment for different production levels. Marel mainly provides
equipment and services to the poultry, meat, and fish processing industries,
while Valka produces equipment for the fish processing industry.

The
investigation was comprehensive, and ICA sought views from both competitors and
customers of the merging parties. ICA received over a dozen well-reasoned comments
on the merger from parties concerned in Iceland and countries in Europe, North
America, and Oceania. The comments mostly had to do with the merging companies
both possessing water-jet cutting and portioning technology, patent-protected,
which would create considerable competitive advantage in the opinion of many of
the concerning parties. Additionally, some competitors believed the merged
company would gain a firm position in Europe in equipment manufacturing for the
fish processing industry.

Given the
comments listed above, ICA considered it necessary to investigate extensively the
possible adverse effect of the merger on competition. As a part of that
investigation, ICA collaborated and communicated with a few of its counterparts
in Europe. As a result of that investigation, ICA has concluded that
intervening in the merger is not needed, partly because the merging companies
will continue to face competition from strong international competitors in the
wake of the merger.

Further
information can be found in ICA’s decision (in Icelandic) nr. 41/2021.