US authorities oppose Ardagh’s €1.3bn buyout of rival firm
The US Federal Trade Commission (FTC) is opposing the $1.7bn (€1.3bn) acquisition by Irish firm Ardagh of rival Saint Gobain’s Verallia container business in the North America.
The government body claims the acquisition would “hurt consumers nationwide”.
Ardagh, headed and controlled by Dublin businessman Paul Coulson, agreed in January to pay $1.7m to buy glass manufacturer Verallia North America from France-based Saint Gobain.
It’s poised to be the second-biggest acquisition made by Ardagh, which is one of the world’s biggest manufacturers of glass and metal containers in the world. Its products are used in a diverse range of consumer products produced by household names from Heineken to Unilever.
Ardagh is currently the third biggest player in the $5bn US glass container industry. The acquisition would make it number two, behind rival Owens-Illinois.
But the FTC insists that the acquisition of Verallia will damage competition in the US and ultimately force consumers to pay higher prices.
“This combination would lead to higher costs for brewers and distillers and less innovation in the glass container industry. Ultimately, this transaction will result in higher prices for consumers,” said an FTC spokesman.
The FTC has sought a preliminary injunction to prevent the deal from closing.
“Ardagh is disappointed in the action that the Commission has taken,” it said. “We believe that the transaction will benefit glass container customers and is fully consistent with the antitrust laws.” It added that it will “vigorously contest” the allegations.
Shares in Saint-Gobain opened as much as 1.5pc lower this morning.