The EU antitrust regulators have raided some plastic pipes and fittings producers last month in a possible price-fixing case.
Tessenderlo’s plastic fittings subsidiary Nyloplast was also inspected. We remind that Nyloplast was taken over by Tessenderlo in 2008 for an undisclosed amount and had sales of about € 13.5m at the time of takeover, meaning it is a very small vs Tessenderlo’s overall € 2.1bn revenue. Furthermore it appears that the investigationmainly concerns practices from 2006 which is a pre-Tessenderlo period and hence might in our opinion mean Tessenderlo bears no liabilities.
All in all, we believe at this stage that the potential negative impact from the EU investigation will be limited. No change to our Accumulate rating and € 26 target price.