The Icelandic Competition Authority approves the merger of Marel and Valka
Recently, the Icelandic Competition Authority (ICA) has been investigating the proposed merger of Marel Iceland ehf., a subsidiary of Marel hf., and Valka ehf. Marel and Valka both operate in the food processing sector, manufacturing and servicing equipment for different production levels. Marel mainly provides equipment and services to the poultry, meat, and fish processing industries, while Valka produces equipment for the fish processing industry.
The investigation was comprehensive, and ICA sought views from both competitors and customers of the merging parties. ICA received over a dozen well-reasoned comments on the merger from parties concerned in Iceland and countries in Europe, North America, and Oceania. The comments mostly had to do with the merging companies both possessing water-jet cutting and portioning technology, patent-protected, which would create considerable competitive advantage in the opinion of many of the concerning parties. Additionally, some competitors believed the merged company would gain a firm position in Europe in equipment manufacturing for the fish processing industry.
Given the comments listed above, ICA considered it necessary to investigate extensively the possible adverse effect of the merger on competition. As a part of that investigation, ICA collaborated and communicated with a few of its counterparts in Europe. As a result of that investigation, ICA has concluded that intervening in the merger is not needed, partly because the merging companies will continue to face competition from strong international competitors in the wake of the merger.
Further information can be found in ICA’s decision (in Icelandic) nr. 41/2021.