Private investment fund in the US Sun Capital Partners has obtained clearance from the European Commission under the EU Merger Regulation for its proposed acquisition of Rexam's cosmetics, toiletries and household care products business (CTH) for $459m.
Notified to the commission on 27 September 2012, the transaction combines the cosmetics and other personal care packaging businesses of UK-based Rexam PC and Albéa, one of the portfolio companies of Sun Capital.
The commission conducted an investigation that confirmed that customers in the cosmetics and perfumery industry will continue to have alternative suppliers for cosmetic packaging, besides the merged entity.
The competitive effects of the proposed acquisition in mascara wands and lipgloss applicators, lipstick applicators, fragrance caps and cosmetic closures markets were examined, and it was found that a number of competitors remain active for each type of cosmetics packaging concerned.
A vertical link between Rexam PC's activities in airless and lotion pumps and Albéa's plastic and laminated tube business was also investigated by the commission.
In a bid to provide customers with an airless dispenser tube, many tube manufacturers purchase airless pumps, and the investigation found that competing tube manufacturers would have alternative sources for pumps.
There is also no likelihood that the merged entity would stop supplying Rexam PC pumps to competing tube manufacturers, the commission said.
The commission concluded that the deal would not hinder competition in the European Economic Area (EEA) or a substantial part of it.
Announced in July 2012, the transaction was part of a $709m total sell off by the global consumer packaging group Rexam, including the sale of its high barrier food container business to Silgan for $250m.
France-based Albéa manufactures cosmetic and personal care packaging, while Rexam PC manufactures personal care packaging solutions to the cosmetics and perfumery industry.
Image: Rexam and US Sun Capital Partners have signed an agreement to combine their cosmetics and other personal care packaging businesses.Photo: Rexam.