S AFRICA: Antitrust body hits Foodcorp with price fixing fine
Foodcorp admitted it met with competitors between 1999 and 2007 to fix the price of the commodities
Foodcorp has become the latest South African food company to admit colluding to fix the price of wheat flour and maize meal.
The company, which owns brands including Sunbake bread and 5 Star maize meal, is to pay a fine of ZAR88.5m (US$10.2m).
Foodcorp admitted it met with competitors between 1999 and 2007 to fix the price of the commodities, The South African Competition Commission said.
News of the fine comes weeks after South African poultry group Rainbow Chicken announced it had struck a deal with Foodcorp to buy 64% of the company.
The regulator said Foodcorp had agreed to "fully co-operate with the Commission in the prosecution of other cartel members".
The penalty is the latest development in a story dating back to 2007 when South African competition authorities probed claims of collusion on the prices of milled white maize and milled wheat products.
South African food companies Premier Foods Group, Tiger Brands and Pioneer Foods have already admitted to the collusion.
A fifth firm investigated over wheat flour prices, Goodrich Milling, is still fighting the claims. Its case has yet to be heard.
The five companies were among 18 probed over milled white maize meal prices. That case has yet to be heard.
Both investigations were started after Premier Foods Group asked for leniency. Tiger followed Premier Foods Group and also filed a leniency application.
The commission said it had already settled with Pioneer and two companies investigated in the maize meal probe: Keystone Milling and Carolina Rollermeule.
Rainbow Chicken has said it will pay ZAR1.04bn for its majority stake in Foodcorp to reduce its reliance on poultry.
Foodcorp, in which management and staff own a majority stake, manufactures a range of branded and private-label food.
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