EC to Investigate Aurubis’ $420M Acquisition of Metallo

SEATTLE (Scrap Monster): The European Commission (EC) has announced its decision to open an investigation into the proposed acquisition of Spain-based Metallo Group by Aurubis AG- the Hamburg, Germany-based world’s largest copper recycler. The decision by the antitrust regulator is on the basis of concerns that the acquisition could reduce competition in procurement of copper scrap for refining. The $420 million acquisition was initially announced in the month of May this year.

Announcing the decision, EU Competition Commissioner Margrethe Vestager stated that the Commission has decided to carefully assess the merger between the two leading European copper scrap refiners, so as to ensure that the transaction would not negatively affect competition in the sector. A well-functioning and competitive copper recycling industry is vital for meeting future needs of European industry, she added.

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The EC, in its preliminary investigation, found that the merger of the two companies would result in a very large combined market share in the purchasing and refining of copper scrap. Further, it expressed concerns that the merged entity is likely to hold dominant position in the procurement of copper scrap, thereby giving it increased power to negotiate lower prices. Consequently, the merger could lead to disruption of the normal functioning of the copper recycling industry.

The Commission’s final decision on the proposed merger is likely to be announced on or before April 3, 2020.