The Ministry of Industry and Trade’s Vietnam Competition Authority has reviewed a consulting application regarding the potential monopoly created by local paper firm Saigon Paper and Japan’s Sojitz, concluding that the acquisition does not violate anti-trust law.

Sojitz has reportedly acquired a majority stake in Saigon Paper for US$91.2 million.

According to the authority, after considering the application and opinions of the Industrial Department and the Vietnam Pulp and Paper Association, it found that the economic concentration of the two firms via stake transfer was not prohibited under Article 18 of the law on competition and notification was not required as mentioned in Article 20, as the two firms’ combined market share was below 30% in 2016 and 2017.

Saigon Paper and Sojitz can continue with the acquisition at the authorized State agency according to Article 24 of the law and other related laws, the authority said.

Sojitz had earlier announced the acquisition of Saigon Paper to tap the increasing demand for cardboard and tissue paper in Southeast Asia. The Japanese firm holds 93.8 million shares of Saigon Paper, equivalent to a 95.2% stake.

Sojitz reportedly spent some 10 billion yen, or  US$91.2 million, on the stake in Saigon Paper.

As one of the leading paper firms in Vietnam, Saigon Paper accounts for 18% of the industry’s production capacity. It can produce 40,000 tons of household paper products and 230,000 tons of industrial paper annually. Last year, Saigon Paper made some VND3.3 trillion in revenue.

SGT