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EU launches probe into Aurubis acquisition of Metallo

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By Reuters

BRUSSELS (Reuters) – European Union antitrust regulators have opened an in-depth investigation into German copper giant Aurubis’s <NAFG.DE> planned acquisition of Belgian-Spanish recycling firm Metallo Group, they said on Tuesday.

The commission will assess the merger between Europe’s two leading copper scrap refiners “to ensure the transaction would not negatively affect competition in this important sector”, EU competition commissioner Margrethe Vestager said.

Aurubis, Europe’s biggest copper smelter, said in May it had agreed to buy Metallo for 380 million euros (£325 million) as part of an acquisition-led shift into other metals.

The Commission’s initial investigation into the deal led the EU antitrust regulator to conclude that “the merged entity could hold a dominant position in the procurement of copper scrap for refining”, which could damage the copper recycling industry.

Its in-depth investigation, which could last until April 3, will also assess whether the deal could raise costs for manufacturers generating copper scrap as a by-product, or allow Aurubis to control the supply of key inputs for copper cathodes and wire rods.

Aurubis said it remains confident the takeover will be approved by April 2020 at the latest.

The integration of Metallo into the Aurubis Group “would benefit other market participants”, Aurubis Chief Executive Roland Harings said in a statement.

“We don’t see any restrictions of competition that would arise through the acquisition,” he said. “We therefore remain confident that the EU competition authority will approve our application to acquire Metallo.”

(Reporting by Francesco Guarascio, additional reporting by Michael Hogan in Hamburg; editing by Philip Blenkinsop and)