The Competition Authority has blocked the proposed acquisition of Leanort Group (Xtratherm) by Kingspan Group. It is only the second time the Authority has blocked a proposed merger since new regulations came into effect in January 2003.
The Authority says the deal, if it had gone ahead, would substantially lessen competition in the manufacture and provision of insulation materials in the country.
The decision follows a four month market investigation by the Competition Authority's Mergers Division.
It is only the second time the Authority has blocked a merger since the provisions of the Competition Act regarding merger control came into effect in January 2003.
The Authority said it would publish its full determination on or before November 25 and will make no further comment on the matter until then.
In a statement, Kingspan said it was disappointed with the Authority's decision. It said it believes that it is not supported by the weight of evidence produced by Kingspan and Xtratherm in their submissions.
'Kingspan in consultation with the vendors will study the written determination of the Authority and take advice from its lawyers, before deciding whether or not to appeal the decision to the High Court,' a statement from the company said.
The building materials group said in June that it had agreed to buy UK-based insulation board makers Hytherm and Xtratherm in a deal which could be worth up to €87m. Kingspan said it wanted to buy the holding company, Leanort, from the Hynes family and others.
Under the deal, Kingspan planned to buy 100% of Leanort for €67m and also planned to acquire up to €20m in debt when the deal is complete. Xtratherm had revenue of €68m and pre-tax profits of €6m last year.
Kingspan shares were down 5 cent to €16.50 in Dublin this evening.
