Kingspan ‘misled’ investigators on Trimo deal, European Commission alleges

Insulation maker Kingspan intentionally or negligently misled competition regulators during their investigation of its now-abandoned bid for Slovenian rival Trimo, the European Commission alleged on Tuesday.

Kingspan dropped plans to buy roofing and insulation materials manufacturer Trimo in April 2022, which had triggered a commission investigation into the deal’s potential impact on competition in several insulation panel markets.

The following November the commission opened an investigation to determine if Kingspan had supplied incorrect, incomplete or misleading information to its original examination of the deal’s likely implications for competition.

The commission said on Tuesday that it had taken the preliminary view that “Kingspan intentionally, or negligently, provided incorrect, incomplete and misleading information” about basic facts.

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These would have allowed regulators to assess the scope of the relevant product and geographic market, the existence of barriers to entry and expansion, the closeness of competition between Kingspan and Trimo and their competitors, and the importance of innovation, said a statement.

The commission sent details of its preliminary finding to Kingspan in a so-called “statement of objections”.

It noted that this did not prejudge the final outcome of its investigation and pointed out that Kingspan had the option of replying.

If the commission finally concludes that Kingspan did provide incorrect, incomplete or misleading information to the competition investigation, the Irish group could face fines of up to 1 per cent of its worldwide sales.

Kingspan responded that it did not agree with the commission’s preliminary findings in the Trimo case.

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“We will of course reflect carefully on them and work with our legal advisers in formulating our response and we look forward to continued positive co-operation with the commission into the future,” the company added.

Kingspan pointed out that it had co-operated fully with the commission from its original bid for Trimo in September 2020 until it withdrew in April 2022, and through the follow-up investigation that began in November 2022.

“This Trimo application was unusual and uniquely onerous given both the level of information sought and the fact that the process occurred during Covid,” said Kingspan.

“It is in no way representative of the long and productive relationship that Kingspan has with the European Commission.”

The Irish group added that since its bid for Trimo in 2020, the commission has cleared four other investments by Kingspan.

It stressed that it had always endeavoured to give the commission all the information it needed quickly and completely, and would continue to do so.

Margrethe Vestager, executive vice-president of the European Commission in charge of competition policy, said companies must supply accurate and complete information to merger investigations.

“This is essential for merger reviews to remain both speedy and effective. In this case we are concerned that Kingspan may have provided incorrect, incomplete and misleading information during our review of its acquisition of Trimo,” she added.

The EU investigates proposed mergers it believes risk damaging normal commercial competition in any market for goods or services in the bloc.

Kingspan and Trimo both make mineral fibre insulation boards, which they sell in several European Union jurisdictions, including the Czech Republic, Denmark, France, Hungary, Slovakia and Slovenia.

Kingspan notified the EU of its bid to buy Trimo from its owner, Polish investor Innova Capital, in September 2020. The commission’s competition directorate then began an initial review.

It stepped this up to a more detailed “phase two” investigation in April 2021 after the preliminary review found the pair competed in selling insulation boards in several member states.

Ms Vestager noted at the time that together, Kingspan and Trimo would have created by far the biggest player in Europe and become the main supplier of mineral fibre panels.

A statement of objections is the formal step through which the commission tells a company of the issues raised against it.

Kingspan can examine the documents in the commission’s files, reply in writing and seek an oral hearing to make its case to the European Commission and the Irish Competition and Consumer Protection Commission.