Blog: Dean BestHain Celestial's Orchard House deal waved through

Dean Best | 23 September 2016

The UK's competition regulator has given the all-clear to Hain Celestial's bid to buy UK food and beverage group Orchard House Foods, nine months after the US group announced the deal.

The country's Competition and Markets Authority has accepted the undertakings Hain Celestial had put forward to ease the regulator's concerns over the impact the US group's acquisition will have on the country's fruit juice market.

Since March the Competition and Markets Authority has been looking at the transaction. In May, Hain Celestial was asked to look again at its move to buy Orchard House and put forward "acceptable undertakings" to solve the concerns or see the planned acquisition be subject to an in-depth "phase two" investigation.

At the time, the regulator also said the deal would lead Hain Celestial to hold "a significant share" of the supply of prepared fruit to retailers but insisted there would still be "sufficient competition" from rivals.

Hain Celestial offered to sell its assets in the manufacture and supply of branded and own-label freshly squeezed fruit juice to retail and foodservice customers, except the Johnson’s Juice brand. It has also offered to offload its own-label carbonated citrus drinks and own-label smoothies business. It put forward UK food and beverage firm Multiple Marketing Limited as the buyer of the assets.

Under a proposed agreement between Hain Celestial and Multiple Marketing, the UK business will continue to manufacture the US group's ingredients products, as well as make its Johnson's branded freshly squeezed fruit juice and New Covent Garden branded smoothies.

During the consultation on Hain Celestial's proposed undertakings, it was brought to the CMA’s attention the owner of Multiple Marketing was also a shareholder of another supplier of own-label fruit juice, Fruitapeel (Juice).

That company is not present in the supply of own-label freshly squeezed fruit juice to retailers but does supply some foodservice customers and therefore the acquisition would reduce the number of suppliers of own-label freshly squeezed fruit juice to foodservice outlets in the UK.

However, the CMA said yesterday it had looked into the dynamics of that market and was satisfied with Hain Celestial's decision to sell the assets to Multiple Marketing.

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