CCP approves textile yarn merger
In spite of positive developments, the textile industry is grappling with the elevated energy costs and the shortage of gas, which remain significant challenges. photo: file
The Competition Commission of Pakistan (CCP) has given the green light for a significant merger in the textile yarn sector, marking a notable development in the industry. The approved transaction involves the acquisition of up to 29.43% shareholding of M/s Gatron (Industries) Ltd by M/s Nova Frontiers Ltd, as per a press statement released on Saturday.
M/s Nova Frontiers Ltd, a Pakistani public unlisted company, is engaged in investments of shares, stocks, bonds, units of mutual funds, and related securities. M/s Gatron (Industries) Ltd, on the other hand, is a public listed company primarily involved in the manufacturing of polyester filament yarn in Pakistan. In 1988, Gatron expanded its product range by introducing the Polyethylene Terephthalate (PET) line, which provided enhanced durability and versatility in various applications.
According to the statement, the CCP’s Phase I competition assessment identified ‘Polyester Filament Yarn (PFY) and Polyethylene Terephthalate (PET)’ as the relevant markets. Following the transaction, the market share of Nova Frontiers Ltd in both markets will remain unchanged.
The analysis confirmed that the transaction would not result in the dominance of Nova Frontiers Ltd in the relevant market. Consequently, the merger was authorised under Section 31 of the Competition Act, 2010. This approval by the CCP aims at developing a sustainable and fertile environment for the textile industry’s growth, ensuring the availability of innovative products that adapt to contemporary market demands.