The Commerce Commission has granted clearance to Allied Foods (N.Z.) Limited (Allied Foods) acquiring all of the shares of Dad’s Pies Limited (DPL).
Both Allied Foods (though its subsidiary George Weston Foods (NZ) Limited (GWF)) and DPL manufacture and supply savoury pies and sausage rolls in New Zealand. They sell these to a variety of customers including supermarkets, dairies, convenience stores, petrol stations and food distributors (which supply cafes and restaurants).
GWF sells its pies and sausage rolls under the “Big Ben” brand. DPL sells its products under “The Baker’s Son” brand to supermarkets, and under the “Dad’s Pies” brand everywhere else.
Commissioner Dr Derek Johnston says the Commission is satisfied that the acquisition is unlikely to substantially lessen competition in any New Zealand market.
“Our investigation found that GWF and DPL are not each other’s closest competitors in New Zealand. Customers consider Big Ben to be a ‘base’ or ‘mainstream’ pie, whereas Dad’s Pies are considered to be ‘premium’ pies,” Dr Johnston said.
“We also found that GWF and DPL compete against several large and well-resourced competitors, including from Australia. Post-merger, we expect that the merged entity will face significant competition from these players for all the different types of customers they supply.”
A public version of the written reasons for the decision will be available on the Commission’s in the near future.
Background
We will give clearance to a proposed merger if we are satisfied that the merger is unlikely to have the effect of substantially lessening competition in a market.
