Commission again declines to clear Medical Waste Group to acquire San-I-Pak
Published16 Mar 2000
The Commerce Commission today declined to clear Medical Waste Group Limited's second application to acquire the business of San-I-Pak (NZ) Limited.
It had declined the first application in January this year.
Commissioner Cathie Harrison said that, after further investigation, the Commission's reasons for declining the application had not changed. It is not satisfied that the proposal would not result in Medical Waste Group acquiring or strengthening a dominant position in the South Island market for the treatment of medical and quarantine waste.
In considering the second application, the Commission revisited its earlier investigation, and analysed new information provided by Medical Waste Group and other parties.
Both Medical Waste and San-I-Pak are involved in the collection and treatment of two sorts of waste: medical waste from hospitals and other medical facilities, and quarantine waste from aircraft and ships arriving from other countries. Currently these wastes are either incinerated or sterilised in an autoclave.
In the South Island, the two companies have a very high combined market share, and a merged entity would face a lack of constraint from existing or potential competitors within a reasonable time frame, or from most buyers of its services.
For these reasons, the Commission was not satisfied that this proposal would not result in the acquisition or strengthening of a dominant position in the South Island market for the treatment of medical and quarantine waste.
The Commission was satisfied that the combined entity would not acquire or strengthen a dominant position in the North Island market for the treatment of medical and quarantine waste, and the South Island and North Island markets for the collection of medical and quarantine waste.
Background
The Commerce Act prohibits business acquisitions that result in dominance being acquired or strengthened in any markets.
Parties can apply for a clearance, which the Commission will grant if it is satisfied that dominance is not acquired or strengthened. A clearance, if granted, protects an acquisition from legal action under the Act.
Media contact: Commerce Act Chief Investigator Roger Snell
