Pork Farms/Kerry Foods merger given provisional clearance
The acquisition of Kerry Foods’ chilled savoury pastry business by Pork Farms Group has been provisionally cleared by the Competition & Markets Authority (CMA), following an investigation on the grounds that it could result in a monopoly of the pork pie market.
Details of the acquisition were revealed last summer, however the CMA announced in December that it would be investigating the merger. Both companies manufacture and supply branded and own-label chilled savoury pastry (CSP) products to the food retail sector.
John Wotton, chair of the Pork Farms Caspian/Kerry Foods merger group, said that, looking across the different chilled CSP products, the CMA had provisionally concluded that the deal would not give the parties an opportunity to raise prices or reduce quality.
“The evidence we heard indicated that the merger would not significantly affect customers’ ability to negotiate for the best deal for these products,” he explained.
“If necessary, customers such as retailers and wholesalers could switch to available alternative suppliers and we found that there was sufficient capacity – either currently available or which could be quickly brought into play – to allow customers to switch suppliers.”
Chris Peters, group managing director at Pork Farms Group, commented: “We are very pleased with the CMA’s provisional conclusion that the merger has not resulted, and may not be expected to result, in a substantial lessening of competition.
“However, we are aware these findings are currently provisional and that we are still subject to the interim order, which requires us to continue to hold the acquired businesses separate. We continue to cooperate fully with the CMA.”
A final decision will be issued by 21 June 2015.
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