Mainland cleared to acquire some Kiwi assets and shares
Published15 Oct 1996
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The Commerce Commission today cleared Mainland Products Ltd to acquire some of the assets of Kiwi Co-operative Dairies Ltd and 100 percent of the shares of two Kiwi subsidiaries.
Commission Chairman Dr Alan Bollard said that the Commission was satisfied that the proposal would not result in Mainland acquiring or strengthening a dominant position in any market.
The assets and shares to be acquired by Mainland are:
the TuiPak cheese packaging plant at Pahiatua
the Longburn milk, yoghurt and cultured foods supply factory
the Dairy Express dairy product distribution business
the (formerly) Tui Milk Products sales and administration business
the Hastings town milk supply treatment station
the New Plymouth town milk supply treatment factory and depot
the Hawera cheese shredding operation
100 percent of the shares in Apex Ltd
100 percent of the shares in Timaru Milk Ltd.
The Commission concluded that the relevant markets in which to consider the acquisition were those for:
acquisition, packaging and wholesale supply of natural cheese in New Zealand
wholesale supply of retail sector yellow table fats in New Zealand
manufacture and wholesale supply of cultured dairy products in New Zealand
acquisition of unprocessed milk in the greater part of the North Island.
It found that dominance would not be acquired or strengthened in any of these markets.
If the proposal goes ahead Mainland would acquire 48.5 percent of the market for wholesale supply of natural cheese. It would continue to face strong competition from New Zealand Co-operative Dairy Company with a 31 percent market share. Smaller companies are also active in this market.
In the other markets, Mainland would acquire shares of respectively 9.8 percent, 16.5 percent and 1 percent.
Some media reports have suggested that the Commission is considering clearance for Kiwi to acquire 66 percent of Mainland. Dr Bollard said that it is important to note that Kiwi had not applied for clearance of that acquisition. While such an acquisition may be contemplated by Kiwi and may be related to these acquisitions by Mainland, it is not covered by the clearance the Commission has given.
Media contact:Chief Investigator Commerce Act Geoff Thorn
