Vandemoortele has proposed the sale of one of its UK plants as another step toward gaining regulatory approval for its acquisition of bakery peer Délifrance.
The Belgium bakery group had previously pledged to sell two Délifrance facilities in France to allay EU competition concerns.
However, amid similar anti-trust unease, the UK's Competition and Markets Authority (CMA) launched a so-called Phase 2 investigation in April into the acquisition - first announced in March last year - after Vandemoortele failed to find a buyer for the two sites in France.
The CMA said it has now launched a consultation on the bakery group’s new pledge to divest its factory in the UK city of Worcester. The sale covers the plant’s assets, contracts, its 73 production staff, and customer relationships.
Vandemoortele's “structural remedy” follows the CMA's initial conclusion that the merger may lead to a "substantial lessening of competition (SLC)".
The regulator said the concern relates to “horizontal unilateral effects” in the supply of frozen laminated dough products to retail and foodservice customers.
Vandemoortele had pledged in December to sell the Délifrance facilities in Avignon and Béthune, a move that secured provisional approval from the European Commission.
Announced in March last year, the deal would create a €2.4bn (then $2.6bn) bakery group.
The UK regulatory authority is seeking feedback on the proposed Worcester factory sale, with interested parties given a deadline of 25 June to file comments.
“The CMA may also consider an amended form, or amended forms, of the remedy proposal, and may also consider any other practicable remedies that the parties, or any interested third parties, may propose that would be effective in comprehensively addressing the SLC and any resulting adverse effects we have provisionally identified.”
Délifrance operates 14 production facilities, supplying retail and out-of-home customers across Europe and in Asia. The business employs more than 3,200 staff.
Vandemoortele has 28 manufacturing plants and 3,500 workers. The company’s frozen bakery brands include Lizzi, Banquet d’Or and Lanterna, while the business also produces for private-label customers. It supplies markets in Europe and the US.
