The New Zealand Commerce Commission has approved Woolworths Group Limited’s acquisition of 100 per cent of Beak & Johnston Holdings Pty Ltd.
The Commission concluded the deal is unlikely to significantly reduce competition in New Zealand’s markets for slow cooked meats, soups, ready-made meals, and pies.
“Our investigation found that notwithstanding Woolworths’ significant retail grocery business, the proposed acquisition was unlikely to result in the merged entity refusing to supply Beak & Johnston products to rival grocery retailers, refusing to purchase products from a rival supplier, or doing so on less favourable terms such that it would substantially lessen competition,” Chair Dr John Small said.
The Commission found Woolworths would not likely limit access to Beak & Johnston products or exclude competitors’ products from shelves.
“We don’t believe that Woolworths would have the ability or incentive to restrict rival retailers’ access to convenience or ready-meals,” said Dr Small. “This is because rival grocery retailers could acquire from alternative suppliers across the relevant product categories.”
Dr Small added the Commission saw no evidence that Woolworths would “materially change decisions on the ranging, shelf-positioning or pricing of private label and Beak & Johnston branded products” in a way that would harm competition.
The Commission emphasised that this decision applies specifically to the facts of this case and does not set a precedent for future acquisitions.
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Kia ora,
The Commerce Commission’s approval of Woolworths’ acquisition of Beak & Johnston marks a significant development in New Zealand’s grocery sector. Given Woolworths’ recent rebranding of Countdown stores and its expanding footprint, this move could influence the availability and variety of ready-made meals and related products for Kiwi consumers.
It’s reassuring that the Commission determined the acquisition is unlikely to substantially lessen competition, noting that alternative suppliers remain accessible to rival retailers. However, as a consumer, I hope this consolidation doesn’t lead to reduced product diversity or higher prices in the long term. Maintaining a competitive market is crucial for ensuring quality and affordability.