Latvian Competition Council Clears HS Timber Group Acquisition of Kurekss

COBALT represented Nextwood Two, a member of the HS Timber Group, in securing unconditional merger clearance from the Latvian Competition Council for the acquisition of Kurekss and its subsidiary Kurzemes granulas. The transaction involves the acquisition of Kurekss, a leading Latvian sawmill, and Kurzemes granulas, a wood pellet manufacturer, by Nextwood Two within the HS Timber Group. The clearance decision was adopted on 16 October 2025. Through this acquisition HS Timber, an Austria‑based wood processing group with production facilities in Europe and South America, strengthens its presence in Latvia. Earlier in January 2025 the group also acquired Vika Wood, another major sawmill located 84 km from Kurekss in north‑western Latvia. The merger attracted significant attention from market participants and several competitors urged the Competition Council to block the transaction. Objectors argued the merged entity could exercise buyer power to depress softwood sawlog prices and could attempt to foreclose rival sawmills by strategic overbuying of logs. The Competition Council investigated both theories of harm and concluded that such anti‑competitive effects were unlikely to materialise. In its decision the authority cited continued strong competition from other buyers, the significant market position of the state forestry company Latvijas valsts meži as the largest supplier of sawlogs in Latvia, and the ongoing viability of exporting raw materials as an alternative sales channel to reject concerns about exploitation of local suppliers. The Council also found that overbuying of raw material would not be a credible strategy because the global nature of the sawn timber market prevents recouping such costs through higher downstream prices. Ultimately the Competition Council determined the merged entity would neither have the ability nor the incentive to engage in anti‑competitive practices and therefore granted unconditional clearance. COBALT represented Nextwood Two, a member of HS Timber Group, with a team composed by: partner Uģis Zeltiņš; Senior Associate Ivo Maskalāns; Senior Associate Kristīne Rāviņa.

Latvian Competition Council Clears HS Timber Group Acquisition of Kurekss

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