<?xml version="1.0" encoding="utf-8" ?>
<xsl:stylesheet version="1.0" xmlns:xsl="http://www.w3.org/1999/XSL/Transform"
  xmlns="urn:schemas-microsoft-com:office:spreadsheet"
  xmlns:o="urn:schemas-microsoft-com:office:office" 
  xmlns:x="urn:schemas-microsoft-com:office:excel"
  xmlns:ss="urn:schemas-microsoft-com:office:spreadsheet">
  <xsl:template match="/">
    <xsl:processing-instruction name="mso-application">
      <xsl:text>progid="Excel.Sheet"</xsl:text>
    </xsl:processing-instruction>
  <Workbook>
    <Styles>
      <Style ss:ID="Default" ss:Name="Normal">
        <Alignment ss:Vertical="Bottom"/>
        <Borders/>
        <Font ss:FontName="Arial Cyr" x:CharSet="204"/>
        <Interior/>
        <NumberFormat/>
        <Protection/>
      </Style>
    <Worksheet ss:Name="sheet 1">
      <Table x:FullColumns="1"
   x:FullRows="1">
        <Row ss:AutoFitHeight="0" ss:Height="13.5">
          <Cell ss:Index="2" ss:StyleID="s42">
            <Data ss:Type="String">SL#</Data>
          </Cell>
          <Cell ss:MergeAcross="1" ss:StyleID="m18876918">
            <Data ss:Type="String">SUPPLIER NAME</Data>
          </Cell>
          <Cell ss:StyleID="s51">
            <Data ss:Type="String">PACKAGES</Data>
          </Cell>
        </Row>
        <xsl:apply-templates select="//TestTable" />
     </Table>
    </Worksheet>
  </Workbook>
</xsl:template>

<xsl:template match="TestTable">
  <Row ss:AutoFitHeight="0" ss:Height="23.25">
    <Cell ss:Index="2" ss:StyleID="s82" ss:Formula="=ROW()-9">
      <Data ss:Type="Number"> 1 </Data>
    </Cell>
    <Cell ss:MergeAcross="1" ss:StyleID="m18876938">
      <Data ss:Type="String">
        <xsl:value-of select="SupplierName" />
      </Data>
    </Cell>
------------------------------------ 
вот тут нужно сделать объединение ячеек, если поле 'Packages' повторяется
  <Cell  ss:MergeDown="???" ss:StyleID="s71">
      <Data ss:Type="String">
        <xsl:value-of select="Packages" />
      </Data>
    </Cell>
------------------------------------
</Row>
  </xsl:template>
</xsl:stylesheet>

<TestDataSet>
  <TestTable>
    <ID> 6 </ID>
    <SupplierName>SAF</SupplierName>
    <Packages> 1  x BOX</Packages>
  </TestTable>
  <TestTable>
    <ID> 1 </ID>
    <SupplierName>SAF</SupplierName>
    <Packages> 1  x BOX</Packages>
  </TestTable>
  <TestTable>
    <ID> 3 </ID>
    <SupplierName>SAFD</SupplierName>
    <Packages> 1  x BOX</Packages>
  </TestTable>
  <TestTable>
    <ID> 4 </ID>
    <SupplierName>SAF</SupplierName>
    <Packages> 11  x CARTONS IN ONE PALLETE &  2  BUNDLES</Packages>
  </TestTable>
  <TestTable>
    <ID> 5 </ID>
    <SupplierName>SAF</SupplierName>
    <Packages> 11  x CARTONS IN ONE PALLETE &  2  BUNDLES</Packages>
  </TestTable>
  <TestTable>
    <ID> 2 </ID>
    <SupplierName>SAFD</SupplierName>
    <Packages> 11  x CARTONS IN ONE PALLETE &  2  BUNDLES</Packages>
  </TestTable>
</TestDataSet>

  <xsl:for-each select="TestTable">
      <xsl:variable name="Packages" select="Packages"/>
      <xsl:if test="not(preceding-sibling::TestTable[Packages = $Packages])">
        <Cell ss:MergeDown="{count(../TestTable[Packages = $Packages])}" ss:StyleID="s71">
          <Data ss:Type="String">
            <xsl:value-of select="$Packages" />
          </Data>
        </Cell>
      </xsl:if>
    </xsl:for-each>

<?xml version="1.0" encoding="utf-8"?>
<xsl:stylesheet version="1.0" xmlns:xsl="http://www.w3.org/1999/XSL/Transform">
	<xsl:template match="/TestDataSet">
		<Table>
			<xsl:apply-templates select="TestTable">
				<xsl:sort select="Packages"/>
			</xsl:apply-templates>
		</Table>
	</xsl:template>
	<xsl:template match="TestTable">
		<xsl:variable name="Pack" select="Packages"/>
		<Row>
			<xsl:apply-templates mode="all"/>
			<xsl:if test="count(preceding::TestTable[Packages=$Pack])=0">
				<Cell MergeDown="{count(following::TestTable[Packages=$Pack])}">
					<xsl:value-of select="Packages"/>
				</Cell>
			</xsl:if>
		</Row>
	</xsl:template>
	<xsl:template match="*[not(self::Packages)]" mode="all">
		<Cell>
			<xsl:value-of select="."/>
		</Cell>
	</xsl:template>
	<xsl:template match="Packages" mode="all">
		<!--do nothing-->
	</xsl:template>
</xsl:stylesheet>