Cavalier Wool applies for authorisation to buy Wool Services

09 Feb '11

2 min read

The Commerce Commission has received an application from Cavalier Wool Holdings seeking authorisation to acquire up to 100 per cent of:

- New Zealand Wool Services International's wool scouring assets and stock or any interconnected body corporate of that company; and/or

- the shares in New Zealand Wool Services International.

When it receives an application for authorisation, the Commerce Commission must first determine whether the relevant acquisition has the effect of substantially lessening competition in a market. If it does not, the Commission may give clearance for the acquisition. If it does, the Commission must determine whether any benefits to the public of New Zealand arising from the acquisition outweigh the detriments due to the loss of competition. If there is a net positive public benefit the Commission must authorise the acquisition which may occur notwithstanding the loss of competition arising.

Cavalier Wool Holdings owns two wool scouring plants in Hawkes Bay and in Timaru. Cavalier Wool Holdings Limited is 50 per cent owned by Cavalier Corporation and 25 per cent by each of Direct Capital and ACC. Cavalier Corporation has other subsidiaries involved in wool procurement and in the manufacture of carpets.

New Zealand Wool Services International is both a wool scourer and a wool trader. It owns two scouring plants, one in Hawkes Bay and the other near Christchurch. Together Plum Duff and Woolpak Holdings own 63.87 per cent of the shares of New Zealand Wool Services International. Plum Duff and Woolpak Holdings are in receivership and the receivers have sought expressions of interest to acquire the shares in New Zealand Wool Services International.

Commerce Commission