The Australian Competition and Consumer Commission today announced that it would not oppose the merger of mineral sands miners RGC Limited and Westralian Sands Limited.
The companies both mine titanium-rich minerals (ilmenite, rutile and leucoxene) and process them into feedstocks which are used in the manufacture of titanium dioxide pigment. This pigment is used to colour numerous products, predominantly paint, plastics and paper. The feedstocks are sold to large local and overseas pigment manufacturers including Millennium, Tioxide, DuPont and Kerr-McGee.
The parties also mine zircon, which is used primarily in the ceramics industry and for refractories in the steel industry.
Australia is the world's largest producer and exporter of titanium feedstocks and zircon.
'While the merger will reduce from two to one the number of non-integrated suppliers of titanium dioxide feedstocks to domestic pigment manufacturers, the Commission took into account that the merged firm will compete in a world market against strong overseas competitors', ACCC Chairman, Professor Allan Fels, said today. 'Potential import competition in both titanium dioxide feedstocks and zircon is likely to provide an effective constraint on the merged firm'.
'This decision exemplifies the ACCC's attitude towards mergers in trade-exposed industries, as set out in its 1997 publication Exports and the Trade Practices Act,' Professor Fels said.
The companies both mine titanium-rich minerals (ilmenite, rutile and leucoxene) and process them into feedstocks which are used in the manufacture of titanium dioxide pigment. This pigment is used to colour numerous products, predominantly paint, plastics and paper. The feedstocks are sold to large local and overseas pigment manufacturers including Millennium, Tioxide, DuPont and Kerr-McGee.
The parties also mine zircon, which is used primarily in the ceramics industry and for refractories in the steel industry.
Australia is the world's largest producer and exporter of titanium feedstocks and zircon.
'While the merger will reduce from two to one the number of non-integrated suppliers of titanium dioxide feedstocks to domestic pigment manufacturers, the Commission took into account that the merged firm will compete in a world market against strong overseas competitors', ACCC Chairman, Professor Allan Fels, said today. 'Potential import competition in both titanium dioxide feedstocks and zircon is likely to provide an effective constraint on the merged firm'.
'This decision exemplifies the ACCC's attitude towards mergers in trade-exposed industries, as set out in its 1997 publication Exports and the Trade Practices Act,' Professor Fels said.