News dairy business
Agreement on the sale of the German FrieslandCampina branch
The sale of FrieslandCampina's German dairy activities to Theo Müller may go ahead, the German Bundeskartellamt has decided. Müller has had to make a number of concessions for this, it is reported.
For example, Müller has promised to resell the Tuffi brand to a third party. The Landliebe brand must also be given an 'irrevocable' license to another company. According to the Bundeskartellambt, this option (specifically licensing a brand) was chosen because they could not legally go any further.
Restrictions in 3 segments
Reason to limitations to apply is that Theo Müller would otherwise acquire too dominant a position in three segments of the German fresh dairy market. It concerns the markets for rice with milk desserts, for fresh mixed dairy drinks and basic milk drinks. The Bundeskartellamt has applied a complex simulation to visualize the expected effects and has issued an indication based on this. With a takeover of FrieslandCampina's entire German dairy business, Müller had achieved a market share of more than 60% for the aforementioned categories. After application of the allowances, the share is expected to fall below 40%. This is the limit above which we speak of a dominant position in the market.
Loss-making since 2006
FrieslandCampina is pleased that the sale can now be finalized. This means that three factories in Germany are disposed of. The German members and their milk production remain with the cooperative. Müller can rely on FrieslandCampina's milk supply for up to a year. An acquisition amount has not been disclosed. During the presentation of the annual figures, CEO Hein Schumacher expressed his satisfaction that the German activities are sold. He said they had been losing money since 2006.
Klaas van der Horst
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