UPDATE 1-Germany blocks Lenzing takeover of Kelheim
* Cartel office says takeover would create tampon monopoly
* Lenzing wants to buy 90 percent of Kelheim
* Lenzing says will appeal (Adds Lenzing comment, shares, background)
DUESSELDORF, Germany, Nov 23 (Reuters) - Germany's cartel office has blocked the planned takeover of Kelheim Fibres by Austrian cellulose fibre maker Lenzing, saying it would produce a monopoly in tampon fibres.
Lenzing had wanted to buy 90 percent of Germany's Kelheim, which is privately owned with more than 700 employees and exports its specialty fibres to 44 countries worldwide.
"The takeover would create a market monopoly. Competition would come to a halt not only in Germany but worldwide," cartel office chief Andreas Mundt said on Friday.
Lenzing said it would appeal against the decision, saying the vast majority of relevant competitors were in Asia and the 10 million-euro German market was too small to be regulated.
Lenzing shares were up 0.3 percent to 63.6 euros by 1442 GMT, underperforming a 0.8 percent-higher ATX, the Austrian benchmark index. (Reporting by Matthias Inverardi and Angelika Gruber; writing by Georgina Prodhan; Editing by Mark Potter)