The Antitrust Authority has been conducting a criminal inquiry against processed tomato products manufacturers, Prinir (Hadas 1987) Ltd., and Milos (1989) Ltd, which are suspected of merging without the approval of the authority. The inquiry came to light today after Antitrust Authority director Ronit Kan asked the Restrictive Trade Practices Tribunal to stop the takeover by Prinir of Milos from going ahead.
Kan also asked the court to appoint an independent manager for Milos, and to issue an injunction banning both companies from having any contact with each other, including individuals that have been associated with Prinir's attempted takeover of Milos. Kan asked for the injunction out of a genuine concern that Milos's competitive capacity could be wiped out before the tribunal rules on whether the merger should be cancelled.
Prinir and Milos are two of the three main competitors on the tomato products market, and together they control half the relevant sectors.
Kan's application to the Tribunal today revealed that the Antitrust Authority received information which indicated that Prinir staged its takeover of Milos through a private company that it jointly owns with two Swiss businessmen. Under the merger, the private company acquired Milos outright, while Milos's CEO become the dominant figure, simultaneously managing the two companies.
The Antitrust Authority's inquiry uncovered evidence that Prinir had been extensively involved in the management of its rival Milos, and had effectively turned it from a competitor into a second rate rival. The parties went ahead with the acquisition of Milos by Prinir's subsidiary without first securing approval from the Antitrust Authority.
Kan has taken an exceptionally grave view of the unauthorized merger between Prinir and Milos, which would pose a significant risk to competition in a number of sectors.
Published by Globes [online], Israel business news - www.globes.co.il - on April 15, 2007
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