Pies and prejudice – Princes to sell Fray Bentos to pacify OFT

PRINCES, the Liverpool-based food group, has told the Office of Fair Trading it will sell the Fray Bentos tinned pies brand to allay competition fears.

Princes announced a £182m deal to buy the canned food operations from listed rival Premier Foods in February.

The OFT was asked to examine the deal under European competition law and after an investigation said it “”considers that the merger would lead to competition concerns in relation to the supply of canned pies in the UK.”

To resolve the matter its said Princes and Premier: “have offered to divest the Fray Bentos brand.”

Amelia Fletcher, chief economist at the OFT and decision maker in this case, said:
‘The evidence in this case suggests that post-merger the parties would have a near monopoly in the provision of canned pies.

“We are concerned that consumers will be left with extremely limited choices in relation to this product, as well as unwelcome price rises. The parties have offered to divest the Fray Bentos brand along with manufacturing assets.

“The OFT generally requires remedies to be clear-cut and capable of being readily implementable. The proposed remedy appears to achieve both these aims.’
In the event that a buyer is not found or accepted as a suitable purchaser by the OFT, the matter will be referred to the Competition Commission.

A spokesperson for Princes said: “We acknowledge the OFT announcement and will consider its implications.

“Our expectation is that the acquisition of the canning operations of Premier Foods will be completed by the end of July.”

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