France-based agri-food co-ops Euralis and Maïsadour have walked away from their plan to combine their operations in foie gras, salmon and direct sales.
The companies set out their proposed venture in May last year.
France’s competition watchdog, L’Autorité de la Concurrence, took an initial look at the proposed deal and argued the transaction would give the venture “significant market shares” in the collection of animals for slaughter and in downstream markets for the “production and marketing of fattened duck products”.
There would therefore be a risk of higher prices and lower product quality, the anti-trust body asserted.
In December, L’Autorité de la Concurrence opened an “in-depth” investigation into the plans.
According to the watchdog, Euralis and Maïsadour had put forward possible unspecified “remedies” but the proposals were not enough to prevent the launch of the investigation.
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The companies’ decision to pull the plans was announced by the regulator today (31 August).
“This transaction could have presented high competitive risks, particularly in the downstream markets for the marketing of fattened duck products to mass retail distribution and out-of-home catering,” the watchdog said.
Just Food has contacted Euralis and Maïsadour for comment.
L’Autorité de la Concurrence said the proposed venture would have had “strong brands, very high market shares in numerous segments of the downstream markets for the marketing of fattened duck products to supermarkets, hypermarkets (GMS) and out-of-home catering (RHF)”.
The regulator said the new entity would have also had “a very significant share in the production and slaughtering of fattened ducks in France, in a sector severely impacted by avian flu”.
It added: “The Autorité also noted the absence of factors likely to discipline the behaviour of the new entity, due to the absence of sufficient current and potential competition, and the lack of credible alternative sources of supply for GMS and RHF distributors following the transaction.”