Mpact reaches settlement with CompCom

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Mpact reaches settlement with CompCom

Published Date: 2020-02-14 | Source: Stephen Gunnion | Author: Stephen Gunnion

Mpact reaches settlement with CompCom

The packaging group maintains that the relationships with the companies it acquired stakes in were above board.

Mpact has agreed to pay a R7 million penalty after the Competition Commission alleged it colluded with companies it acquired stakes in without the Commission's consent.

The Commission said the paper and packaging group took control of a number of companies through its Rebel Packaging subsidiary without reporting them to the Commission, even though there were notifiable mergers. It said Mpact had admitted to the contravention. A further investigation found that the group was then involved in collusive conduct including price fixing, collusive tendering and dividing the markets that make and supply corrugated packaging products. It alleged Mpact, as a supplier and shareholder to the sheet plants, had insights into their costs and pricing, as well as the specific customers they were targeting. It had board representation at the sheet plants.

The Commission said the settlement resolved all issues around the prior implementation of the acquisitions and the alleged collusion.

In response, Mpact said at all relevant times it and the sheet plants were principally in a supplier-customer relationship and it had a signifiant minority shareholdings in the plants concerned, rather than controlling stakes.

Mpact's shares fell 0.7% to R15.15 yesterday.





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