Fray Bentos Brand Sold to Baxters to Remedy Merger Concerns
The OFT has accepted undertakings offered by Princes Limited (Princes) to address the competition concerns arising from its completed acquisition of the canning business of Premier Foods Group Limited (Premier).
As a result, the merger will not be referred to the Competition Commission.
Under the terms of the undertakings, the Fray Bentos brand and its manufacturing assets will be sold to Baxters Food Group Limited (Baxters) to resolve competition concerns raised by the merger.
The OFT carefully assessed and consulted publicly on the proposed undertakings, as well as on the suitability of Baxters as a purchaser of the Fray Bentos brand.
Amelia Fletcher, Chief Economist at the OFT and Decision Maker in this case, said: “This merger would have led to a near monopoly in the provision of canned pies in the UK.
“However, the sale of the Fray Bentos brand to Baxters will restore pre-merger levels of competition for the benefit of consumers. The OFT believes that Baxters, with its extensive experience in the sector, is a suitable purchaser for the business.”
The OFT considered in this case that a necessary requirement to suspend the duty to refer and consider undertakings was that Princes identify an upfront buyer for the Fray Bentos brand.
A provisional sale to that buyer needed to be agreed before the OFT accepted the undertakings. This means that the OFT was able to consult publicly on the suitability of Baxters as the proposed purchaser during the public consultation period.
Before accepting the undertakings the OFT gave notice of the proposed undertakings under Schedule 10 of the Enterprise Act 2002.