FCCA to initiate further proceedings regarding the merger of Kesko Food and Suomen Lähikauppa

The Finnish Competition and Consumer Authority (FCCA) has initiated further proceedings concerning an acquisition whereby Kesko Food Ltd will gain control over Suomen Lähikauppa Oy.

Kesko Food and Suomen Lähikauppa both operate in the sales and procurement market for the retail of daily consumer goods in Finland. Following the ongoing arrangement, the Finnish grocery trade market will become increasingly concentrated when one nationwide chain exits the market entirely. The concentration will affect competition between the chains nationwide and have an impact locally in the catchment areas of Suomen Lähikauppa’s stores. The transaction will provide Kesko Food with a monopoly position in a number of catchment areas of Suomen Lähikauppa’s stores.

In its further proceedings, the FCCA will investigate whether the acquisition significantly impedes effective competition in the Finnish market or a substantial part of it, particularly if the reason for this is an attempt to establish or strengthen market dominance. Following its further proceedings, the FCCA may approve the acquisition as such, attach conditions to the approval or request that the Finnish Market Court prohibit the acquisition. According to the Finnish Competition Act, these further proceedings cannot take longer than three months.

The decision issued by the FCCA on 11 January 2016 includes numerous business secrets of the parties involved. It cannot therefore be published until the confidential information has been removed. The public version of the decision will be posted on the FCCA’s website as soon as it has been finalised.

Further information:
Hanna Kaiponen, Senior Research Officer, tel. +358 29 505 3620
Maarit Taurula, Head of Research, tel. +358 29 505 3381