The ACCC will not oppose the proposed acquisition of the Fero Group (Fero) by DYWIDAG-Systems International Group (the DSI Group).
DSI and Fero both manufacture and supply ground support products and provide services to the underground hard rock mining (i.e. gold, copper and nickel) industry in Australia.
“Together, the companies would hold a significant market share, particularly for the rock bolts used in hard rock mining ground support. Any acquisition that brings together two of the largest suppliers in an industry requires close examination,” ACCC Commissioner Roger Featherston said.
The ACCC considered, however, that remaining competitors would provide sufficient competitive constraint following the acquisition.
“We spoke to a range industry participants and most of them considered that there would be a number of strong competitors remaining. In addition, there is potential for expansion of imports,” Mr Featherston said.
The DSI Group supplies ground control and post-tensioning control systems and concrete accessories to mining, tunnelling and construction customers around the world.
In Australia, DSI Australia manufactures and supplies mining support products to the soft and hard rock mining industries, as well as reinforcement products to the geotechnical and tunnelling industries. DSI Australia also has a small civil business which supplies post-tensioning and geotechnical products to the construction and tunnelling sectors.
Fero is an Australian family owned and run company which supplies a range of mining support products to the hard rock mining industry and operates a galvanizing and mesh manufacturing business which supplies products to both mining and construction customers. Fero does not operate in the soft rock mining sector.
In 2016, the ACCC reviewed DSI’s proposed acquisition of Jennmar Australia’s ground support business. The ACCC raised competition concerns in relation to the supply of rock bolts used in soft rock (coal) mining. The parties withdrew their application for clearance the day before the ACCC was due to announce its final decision, and the acquisition did not proceed. Jennmar is also a competitor in the supply of hard rock ground support.