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(Bloomberg) — South Africa’s Competition Commission said it’s searching offices of packaging-paper producers Mpact Ltd. and New Era Packaging (Pty) Ltd., as part of an investigation into allegations of pricing collusion involving the two companies.
“The commission has reasonable grounds to suspect that New Era and Mpact have engaged in collusive practices,” the Pretoria-based antitrust regulator said in an e-mailed statement on Thursday. The Competition Act “prohibits competitors from reaching agreements to fix prices, allocate customers or rig tenders.”
Mpact has “zero tolerance towards anti-competitive behavior,” the packaging maker said in a statement. “The company is committed to ensuring that its employees, management, and directors do not engage in any conduct that constitutes prohibited practice.”
Mpact shares erased gains and fell 2.5 percent to 37.36 rand at 4:06 p.m. in Johannesburg. The stock has fallen 20 percent this year, valuing the company at 6.3 billion rand ($404 million).
“New Era is not aware of any contraventions at this stage,” joint-CEO Asha Chhita said by text message. “Full cooperation will be extended by New Era to the competition authorities in the information gathering phase of their investigations.”
The Competition Commission takes allegations of collusion seriously, Commissioner Tembinkosi Bonakele said in the statement.
