Arlas Falbygdens buy faces competition probe

Arla's Falbygdens buy faces competition probe

Arla Foods expects a competition investigation into its proposed acquisition of Atria's specialty cheese business, Falbygdens, will not block the deal.

After a preliminary probe, the Swedish Competition Authority decided to launch a detailed "phase two" investigation into the proposed sale of Falbygdens to Arla yesterday (15 December). A spokesperson told just-food the watchdog is concerned over a possible negative impact on retailers and milk producers. Increased market concentration could also act as a barrier to new entrants to the sector, the Authority added.

However, Arla expects the deal will progress. A spokesperson for the dairy co-operative told just-food: "Our assessment is that the authority will approve the acquisition, but that it can take up to three extra months."

The spokesperson said there is not a significant overlap between the Falbygdens business and Arla's existing portfolio, although the company declined to provide details on what its combined market share would stand at. "Falbygdens is more of a strategic complement to Arla's existing cheese business. The decision to acquire Falbygdens Ost is in line with Arla's strategy, both globally and in Sweden, to drive the premium cheese segment."

The Swedish Competition Authority is due to report its findings by 15 March.