What's Happening?
Greencore has proposed selling a soups and sauces plant to address UK competition concerns over its merger with Bakkavor. The Competition and Markets Authority (CMA) has provisionally approved the remedy,
moving the deal closer to completion early next year. Greencore is in talks with prospective buyers for its Bristol facility, which generates annual revenue of around £47m. The CMA flagged potential competition conflicts in own-label soups and sauces but did not have similar concerns for ready meals and salads. Greencore shareholders would own 59.8% of the new company, with Bakkavor investors holding the remainder.
Why It's Important?
Greencore's decision to sell its Bristol plant is a strategic move to alleviate competition concerns raised by the CMA, facilitating the merger with Bakkavor. This merger is significant for the convenience food industry, as it combines two major players, potentially enhancing market share and operational efficiency. The CMA's approval is crucial for the merger's success, impacting stakeholders such as supermarkets and consumers. The sale of the plant ensures compliance with regulatory requirements, allowing Greencore and Bakkavor to proceed with their plans to create a stronger entity in the food sector.
