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November 3, 2021

George Weston Foods’ Dad’s Pies deal given all-clear

The acquisition is unlikely to substantially lessen competition in the New Zealand market, it has been ruled.

New Zealand’s George Weston Foods has been given the green light to buy local business Dad’s Pies by the country’s competition watchdog.

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What’s the forecast for the food and grocery industry?

The food and grocery sector thrived during the pandemic, largely due to the shutdown of the food service industry and the sector’s subsequent necessity, panic-induced bulk purchasing, and spending more time at home. The market has grown as a result of inflation. Consumer unwillingness to go out and socialize, and the reopening of several hospitality facilities, helped maintain the demand for groceries, particularly online, in 2021. As consumer behavior changes, we consume more food and drink at home, and inflation increases basket sizes. GlobalData predicts that the sector will continue to hold a higher share than had been predicted prior to the pandemic. This is true despite the fact that the food and grocery sector's share of overall retail will decline from its peak in 2020. This report will discuss market forecasts and key themes in the global food & grocery industry in 2022 and beyond. It covers:
  • Market drivers and inhibitors
  • Five-year forecasts and the impact of COVID-19
  • The performance of the online channel versus offline
  • Major trends in the market including rapid delivery, ambient retailing, supply chain disruption, and inflation
Assess developments within this sector to help your business thrive in 2022 and beyond.
by GlobalData
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Commerce Commission commissioner Dr Derek Johnston said it is satisfied that the acquisition is unlikely to substantially lessen competition in any New Zealand market.

Both George Weston Foods (GWF) – which is owned by the UK’s Associated British Foods – and Dad’s Pies (DPL) manufacture and supply savoury pies and sausage rolls in their home market. They sell these to a variety of customers including supermarkets, dairies, convenience stores, petrol stations and food distributors, which supply cafes and restaurants.

George Weston sells its pies and sausage rolls under the Big Ben brand while Dad’s Pies sells its products under The Baker’s Son brand to supermarkets and under the Dad’s Pies brand everywhere else.

But the Commerce Commission saw a distinction in the companies’ product offerings.

“Our investigation found that GWF and DPL are not each other’s closest competitors in New Zealand. Customers consider Big Ben to be a ‘base’ or ‘mainstream’ pie, whereas Dad’s Pies are considered to be ‘premium’ pies,” Dr Johnston said.

“We also found that GWF and DPL compete against several large and well-resourced competitors, including from Australia. Post-merger, we expect that the merged entity will face significant competition from these players for all the different types of customers they supply.”

The Commission revealed GWF’s intention to acquire Dad’s Pies from the company’s shareholders last month. No transaction value was disclosed.

GWF operates in New Zealand and Australia and is regarded as one of the largest food manufacturers in both countries with 40 facilities.

Dad’s Pies, based in Silverdale, near Auckland, was founded in 1981.

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Free Report
img

What’s the forecast for the food and grocery industry?

The food and grocery sector thrived during the pandemic, largely due to the shutdown of the food service industry and the sector’s subsequent necessity, panic-induced bulk purchasing, and spending more time at home. The market has grown as a result of inflation. Consumer unwillingness to go out and socialize, and the reopening of several hospitality facilities, helped maintain the demand for groceries, particularly online, in 2021. As consumer behavior changes, we consume more food and drink at home, and inflation increases basket sizes. GlobalData predicts that the sector will continue to hold a higher share than had been predicted prior to the pandemic. This is true despite the fact that the food and grocery sector's share of overall retail will decline from its peak in 2020. This report will discuss market forecasts and key themes in the global food & grocery industry in 2022 and beyond. It covers:
  • Market drivers and inhibitors
  • Five-year forecasts and the impact of COVID-19
  • The performance of the online channel versus offline
  • Major trends in the market including rapid delivery, ambient retailing, supply chain disruption, and inflation
Assess developments within this sector to help your business thrive in 2022 and beyond.
by GlobalData
Enter your details here to receive your free Report.

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