US: Regs may clear paper merger despite resulting 50% dominance

Authorities may approve of a proposed merger between two major print media paper companies despite the fact that the newly merged company would hold more than 50 percent of the industry.

Verso Paper is looking to acquire its rival NewPage in a $900 million deal. The companies compete in the industry for coated paper that makes magazines and catalogues. If approved, the transaction would hand a 54 percent of the market share to Verso.

Its closest rival, South Africa-based Sappi, would own about 25 percent.

The result would lead to a highly concentrated market, reports say. But experts believe the deal may be approved regardless thanks to overseas competition.

Still, some experts doubt the deal will be cleared, especially due to a history of price-fixing that has plagued the market in recent years.

Full content: Reuters

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