Commission clears Cremation Society of Canterbury to acquire Harewood crematorium
Published08 Sep 2000
The Commerce Commission has cleared the Cremation Society of Canterbury Limited to acquire the remaining 55.14 percent in Harewood Memorial Gardens & Crematorium Limited.
The Cremation Society currently holds 44.86 percent of Harewood, following approval of an earlier clearance application to the Commission in December 1997. A clearance expires twelve months after the date on which it was given. This current application for clearance was made by the Cremation Society due to the expiry of that earlier clearance.
Commission Chair Mr John Belgrave said that the Commission was satisfied that the proposed acquisition would not result in the Cremation Society acquiring or strengthening a dominant position in any market.
Mr Belgrave said that the two relevant markets in this case were those for the provision of cremation services in Christchurch, and for the interment of ashes and provision of memorials in the Christchurch area.
Should the proposal go ahead, the combined entity would have a high market share in the market for the provision of cremation services. However, the Commission concluded that a recent entrant into this market, Garden City Crematory, is likely to provide an effective constraint upon the merged entity.
Further, barriers to entering this market are low. The Commission understands that the costs of premises and a cremator are not prohibitive. Funeral directors, in particular, can enter the market quickly and offer cremation services themselves either individually, or as a consortium.
In the market for the interment of ashes and provision of memorials in Christchurch, people would continue to have a range of options, including interment of ashes at one of six council-owned cemeteries.
Background
The Commerce Act prohibits business acquisitions that result in dominance being acquired or strengthened in any market.
Parties can apply for a clearance, which the Commission will grant if it is satisfied that dominance is not acquired or strengthened. A clearance, if granted, protects an acquisition from court action under the Act.
