The Commerce Commission has granted clearance to ASSA ABLOY New Zealand Limited (Assa Abloy NZ) to acquire all of the shares in NZ Fire Doors Limited (NZFD).
Both Assa Abloy NZ (through its subsidiary Pacific Door Systems Limited (Pacific Doors)) and NZFD manufacture and supply fire-rated doors and windows to the construction industry. Fire-rated doors and windows are specially designed to act as a barrier to the spread of fire. Assa Abloy NZ also manufactures and supplies a range of door and window hardware such as handles, closers and locks.
Commissioner Dr Derek Johnston said the Commission is satisfied that the proposed acquisition is unlikely to substantially lessen competition in any New Zealand market.
“While Pacific Doors and NZ Fire Doors are two of the larger manufacturers of fire rated doors in New Zealand, our investigation indicated that the merged entity would continue to face strong constraint from other fire door manufacturers, who have the ability to expand. In the longer term, there is also the potential for other firms to enter.”
The Commission also considered whether Assa Abloy NZ would have the ability and incentive to bundle and/or tie its supply of doors and hardware in an anticompetitive way, or impede other hardware manufacturers from getting their products tested for fire safety. However, Dr Johnston said that “the Commission was satisfied that Assa Abloy NZ would be unlikely to engage in this behaviour due to the presence of other fire door manufacturers.”
A public version of the written reasons will be available shortly on the Commission’s case register.
Background
Assa Abloy NZ is ultimately owned by Assa Abloy AB, a Sweden-based company. In New Zealand, it supplies a broad range of fire-rated and non-fire-rated doors, windows and hardware, including through its subsidiaries, Pacific Doors, Assa Abloy Entrance Systems NZ Limited, and Placard New Zealand Pty Limited. Pacific Doors has manufacturing facilities in Wellington and Timaru.
NZFD is a New Zealand-based manufacturer and supplier of fire-rated, non-fire-rated, acoustic and specialty doors and windows. NZFD supplies fire-rated doors to construction companies, joiners and resellers from its manufacturing facility in Auckland.
We will give clearance to a proposed merger if we are satisfied that the merger is unlikely to have the effect of substantially lessening competition in a market.
