The European Commission, the 25-nation European Union's regulator, is investigating allegations manufacturers of flat and car glass coordinated price increases and surcharges, commission spokesman Jonathan Todd said today. Regulators raided offices in the U.K., Germany, France, Belgium, Sweden and Italy, he said.
``It was a complete bolt from the blue, a complete surprise,'' said Iain Lough, 58, the group finance director at Pilkington, the world's biggest maker of car windshields. ``They have taken papers away and it's a case of seeing what, if anything, the commission people find, and acting accordingly.''
The commission has levied about 5 billion euros ($6.6 billion) in fines for price-fixing and other antitrust offenses since 1999. Companies found guilty of thwarting competition are typically fined 2-3 percent of sales. The largest fine against a single company was 497 million euros ($658 million) levied against the U.S. software maker Microsoft Corp. in 2004.
Shares of St. Helens, northwest England-based Pilkington fell as much 5.5 pence, or 4.6 percent, to 115.5 pence and traded at 117.5 pence as of 12:12 p.m. in London. Saint-Gobain shares fell as much as 3.4 percent to 44.85 euros in Paris.
Pilkington and Saint-Gobain were the biggest decliners today on a Bloomberg index of Europe's 18 largest makers of building materials.
The EU is examining allegations the companies agreed to increase prices and add an energy surcharge on flat glass, the commission's Todd said. Car glass producers are also suspected of having allocated customers and agreed on supply quotas, he said.
Saint-Gobain, the world's biggest glassmaker, said in a Regulatory News Statement that its headquarters in Paris and a factory in the German town of Aachen were visited by regulators. The company, which made the glass for the pyramids at the Louvre and built the Hall of Mirrors at the Palace of Versailles in the 17th century, said the raids occurred on Feb. 22.
Pilkington said in a Regulatory News Service statement that investigators visited its sites on Feb. 22 and 23 and that it's cooperating with the commission.
Marie-Ange Dhondt, a spokeswoman for Glaverbel SA, a unit of Tokyo-based Asahi Glass, said that a number of its premises had been raided by antitrust officials.
Guardian Industries Corp., one of the four big glassmakers in Europe, referred questions regarding commission visits to a spokesman who wasn't available to comment.