CMA says proposed merger does not raise competition concerns in bagged salads, but flags an issue in sauces
Greencore has expressed optimism that its £1.2bn acquisition of Bakkavor will be greenlighted despite competition authorities raising concerns over one area of business.
In a written decision published this week, the UK’s Competition and Markets Authority (CMA) found that the acquisition by Greencore of Bakkavor Group gives rise to a realistic prospect of a substantial lessening of competition in the supply of own-label chilled sauces in the UK.
The two companies have been given until 3 November to address the compeition concerns identified. If a satisfactory solution is not found, the CMA will refer the merger for an in-depth Phase 2 investigation.
In its view, CMA said the merger does not raise competition concerns in the supply of own-label salads, or own-label Italian chilled ready meals.
“For salads, despite high shares, the evidence indicates there is currently limited competitive interaction between the parties,” it explained. ”Moreover, the Merged Entity will be constrained by at least Samworth, Avondale Foods and Natures Way Foods.”
‘Constructive process’
In response, Greencore and Bakkavor said they were pleased that the CMA’s Phase 1 decision concluded that the merger does not raise concerns in the vast majority of areas reviewed, which cover around 99 per cent of the combined group’s revenues.
The two companies will continue to work with CMA to address the issues around the supply of own-label chilled sauces, they added.
Greencore CEO Dalton Philips said: ”The CMA process has been constructive and the Phase 1 decision is a welcome one, confirming our view of the highly complementary nature of our businesses and product portfolios across ’food for now’ and ‘food for later’.
”I am really grateful to my colleagues at Greencore and Bakkavor in successfully getting us to this point and we are now working with the CMA and Bakkavor for the benefit of all our stakeholders to complete the Bakkavor transaction early next year.
”I’m genuinely excited about what 2026 has in store as we bring these two great businesses together to create a true UK national food champion to deliver high-quality, innovative food to customers and consumers.”
Bakkavor CEO Mike Edwards added: “Today’s positive news from the CMA is a significant step forward in the process, providing welcome clarity which means we can collectively work at pace and stay on track to complete the transaction in early 2026.
”Bakkavor is in great shape and we remain excited about joining the Greencore business and unlocking all the associated benefits we have highlighted for colleagues, customers and shareholders. I would like to thank everyone in Bakkavor and Greencore who has worked so hard in getting us to this advanced stage in the process.”
