A US District Court has approved an injunction to block UPM-Kymmene’s US$420M acquisition of MACtac, the pressure sensitive materials business of the Bemis Co. UPM-Kymmene has terminated the transaction and does not plan to appeal against the decision.
“Naturally, we are surprised and disappointed,” says Pentti Kallio, president of the Raflatac Group. “Because the appeal process’ duration and cost would be difficult to predict and would be a distraction to the business’ continuing development, Raflatac will now seek other opportunities to strengthen its market position.”
On April 15, 2003 UPM-Kymmene received notice that the Antitrust Division of the US Department of Justice had filed a civil antitrust lawsuit to block the acquisition. The EU Commission and the Canadian competition authorities had approved the deal, which was agreed by the two companies in August, 2002.
On August 18, UPM-Kymmene received a grand jury subpoena in connection to the US Department of Justice Antitrust Division investigation into the US labelstock industry. In April, the company was informed that the Department of Justice had opened a criminal investigation into possible price fixing and other forms of collusion in the labelstock industry. UPM-Kymmene says it will “respond to the subpoena in due course”.
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