Bundeskartellamt clears merger between the paper wholesalers Papyrus Deutschland and Papier Union

The Bundeskartellamt has cleared the acquisition of Papyrus Deutschland by Papier Union’s mother company, Inapa Group, in second phase proceedings. The wholesalers in paper, Papier Union and Papyrus Deutschland, are active throughout Germany.

Papyrus Deutschland, based in Ettlingen, is a German subsidiary of OptiGroup AB, Sweden. It is active on several paper wholesale markets in Germany and primarily sells commercial printing and office paper. Papier Union in Cologne is a subsidiary of the Portuguese company Inapa Investimentos Participações e Gestão S.A. and also operates in Germany as a paper wholesaler with a wide range of products.

The paper wholesale sector covers several product markets because several paper categories and customer groups have their own conditions of competition. The merger primarily affects the sale of commercial printing paper. Higher quality paper is generally used for commercial printing paper, which enables particularly clear and perfect printing.

Andreas Mundt, President of the Bundeskartellamt: “We were able to clear the merger in spite of the high market shares of the companies. It is clear from our investigations that customers already buy from different wholesalers and can switch between them thanks to the similar ranges of products and usually short contract periods. Post merger there will still be enough alternatives for customers to for example react to any possible price increases. Furthermore, the wholesalers will be exposed to competitive pressure from possible direct sales from the paper manufacturers.”

The merger between Papier Union and Papyrus will create a company which will close the gap to the market leader, the Igepa Group, Hamburg in the sale of commercial printing paper both throughout Germany and in individual regions in Germany. Post merger both the Igepa Group and the merged companies will each hold market shares of approx. 40 to 45%. Other smaller competitors in Germany are Berberich, Antalis, Kreuser and Römerturm.

During the proceeding the Bundeskartellamt consulted more than 100 printing houses, all the paper wholesalers active in Germany and the major manufacturers of commercial printing paper.

The paper sector is currently undergoing extensive structural change at all market levels. Firstly, many small and medium-sized printing houses have exited the market in recent years and the volume of demand for commercial printing paper has fallen. A larger paper wholesaler has already left the market. Secondly, Sappi Ltd., a globally active paper manufacturer has entered into direct competition with the paper wholesalers on the German market and is now selling its products directly to its end customers.

Further information on this proceeding is available in a case summary (in German) on our website.