CADE’s General Superintendence challenges Knauf’s acquisition of the Trevo factory

Summary:

The Superintendu00eancia-Geral do Conselho Administrativo de Defesa Econu00f4mica (SG/Cade) has referred a concentration operation to the Tribunal Administrativo for analysis. The operation involves the purchase of Trevo Industrial's drywall manufacturing plant by Knauf do Brasil. The SG/Cade has concluded that the merger would represent a high concentration level, exceeding prudent limits, and may lead to a coordinated market. Factors contributing to this conclusion include the homogenization of the product, symmetrical technological production, and lack of historical price rivalry or differentiation. The SG/Cade also notes that the market has only four suppliers, including Knauf and Trevo, and there has been no entry of new competitors in recent years. Therefore, the SG/Cade has opted to impugn the concentration and the case will be distributed to a councilor for further analysis and eventual judgment.