Greencore's buy of Bakkavor set for UK approval as factory to be sold

(Alliance News) - Greencore Group PLC's buy of Bakkavor Group PLC looks set to be green lit, after the UK's antitrust watchdog on Friday said it agreed "in principle" to accept remedies aimed at easing competition concerns.

Convenience food provider Greencore is to sell its Bristol chilled soups and sauces manufacturing site to "resolve" the Competition & Markets Authority's concerns, the watchdog said.

London-based Bakkavor, which Greencore back in May agreed to acquire in a cash and shares deal worth GBP1.2 billion at the time, is also a convenience food provider.

The CMA was worried that the deal could "could result in a substantial lessening of competition in the supply of own-label chilled sauces" such as those for pastas and stir-frys, leading to higher prices for the consumer and a possible reduction in quality.

Greencore and takeover target Bakkavor both sell their products to supermarkets and grocery retailers.

Dublin-based Greencore said the Bristol site generated revenue of GBP47 million in the year ended September 26, which would be worth around 1% of what the combined group would achieve.

"Greencore and Bakkavor are now targeting to complete the transaction in early 2026," Dublin-based Greencore said.

Chief Executive Officer Dalton Philips added: "The CMA's acceptance in principle of the remedy is really good news and means we can now look to complete the Bakkavor deal in early 2026. In parallel, our focus is on finding the right new owner for our Bristol business. It's been great to see such strong interest shown in what is a fantastic chilled soups and sauces operation, and I'm highly confident we'll get a good outcome here."

Greencore said it is "currently engaged with a number of prospective purchasers" of the Bristol site.

Joel Bamford, the CMA's executive director of mergers, said: "The cost of our weekly shop matters to us all, so we must take decisions that ensure there is effective competition helping to keep product prices as low as possible on supermarket shelves. Our assessment found Greencore's deal to buy Bakkavor could raise prices at the till. Following close engagement with Greencore and Bakkavor we've secured remedies which we believe have the potential to address our competition concerns - so we have accepted the remedies in principle today and will now work to towards a final resolution."

Greencore shares fell 0.7% to 230.29 pence each in London on Friday morning. Bakkavor was up 0.2% at 221.50p.

By Eric Cunha, Alliance News news editor

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