According to the assessment by the FCCA the acquisition does not have the kind of significant negative impact on competition as defined by the Competition Act.
On 21 January 2014 the Finnish Competition and Consumer Authority (FCCA) gave its approval to a corporate acquisition in which Atria Plc acquires the procurement, slaughtering and cutting operations for beef, pork and chicken of Saarioinen. Atria and Saarioinen are both significant players in foodstuffs, and especially the meat sector in Finland. In connection with the corporate deal, Atria and Saarioinen signed a supply contract on the basis of which Saarioinen will acquire meat raw material that it requires in its production from Atria.
The Authority studied the impact that the deal would have on competition, especially in the procurement market for animals for slaughter and in the wholesale market for fresh meat. According to the evaluation of the FCCA the sale does not have the kind of significant negative impact on competition as defined by the Competition Act.
In the procurement of animals for slaughter, a significant part of Saarioinen's meat producers have become, or are in the process of becoming producers of Atria's competitors. Consequently, Atria's position on the procurement market is not strengthened by the same amount as the market position of the target of the deal. Even after the transaction, companies on the procurement market include, in addition to Atria, HKScan, as well as Oy Snellman Ab, which has been considerably strengthened by the the meat producers that have joined it after leaving Saarioinen. Producers will continue to have the possibility to select their trading partners from among different meat producers.
The FCCA estimates that in the wholesale market for fresh meat, the change caused by the corporate deal is of little significance. The amount of fresh pork and beef in the possession of Atria will not increase very much, because under the delivery contract Atria is to deliver most of the fresh meat that it gets from the deal to Saarioinen. In the wholesale market for fresh chicken, a new player, Huttulan Kukko, is starting. The slaughter capacity of Huttulan Kukko and the meat volumes that the company is bringing to the market are very close to the capacity and volume of the target of the deal, which reduces, for its part, the market impact caused by the corporate transaction. In addition, HKScan will remain the largest player on the chicken market even after the deal.
The corporate purchase had been deferred in the FCCA for further discussion on 28 October 2013. The purchase was approved without conditions because the legal threshold for intervening was not crossed.
A public version of the decision will be published on the FCAA website in about two weeks.
Head of research Maarit Taurula, tel. +358 29 505 3381
Special Researcher Keijo Ranta, p. +358 29 505 3365