UK sugar trader ED&F Man has agreed to offload its interest in a refinery in Italy to secure EU clearance for the sale of a stake in its business to German giant Südzucker.
ED&F Man is to sell its holdings in a refinery in Brindisi to meet EU concerns over the impact of its deal with Südzucker could have on competition in the sugar sector.
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The European Commission has been looking into Südzucker’s bid to buy almost 25% of ED&F Man since November and said the sale of the UK firm’s interest in the Brindisi refinery was a condition of approving the deal.
Brussels said the companies had agreed to transfer long-term raw cane sugar supply contracts to a firm in Brindisi. That deal would ensure the refinery remains “a viable and competitive force in Italy”, it added.
The Commission said Südzucker’s acquisition of 25% of ED&F Man – minus one share – would not harm competition for raw cane sugar and molasses supplies across the EU. Brussels officials also looked into the impact on the refined sugar sector in Greece and wholesale supplies of refined sugar to retailers in Italy.
Südzucker “welcomed” the European Commission’s decision. A spokesperson noted Brussels had “determined that in most European markets the merger will have no adverse impact on competition.”
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By GlobalDataThe company added the sale of ED&F Man’s holding in the Brindisi refinery was agreed to “alleviate possible concerns in Italy”.
