Competition Concerns Over Ulster Fry Ingredients in NI Bakery Merger
The supply of essential components for an Ulster Fry could become less competitive if two major bakery companies merge in Northern Ireland, according to a regulatory watchdog.
The Ulster Fry, similar to a full English breakfast or an Irish fry, is distinguished by the inclusion of fried potato bread, pancakes, and soda farls.
CMA Review of ABF and Hovis Merger
The Competition and Markets Authority (CMA) has reviewed a proposed merger between ABF bakeries, which owns the Sunblest brand, and Hovis, known for brands including Ormo.
The CMA's provisional findings indicate that the combined entity would control approximately 80% of the Northern Ireland pancake market, 60% of soda farl sales, and nearly 50% of potato bread sales.
This market share concentration is expected to lead to
"a substantial lessening of competition", the CMA stated.
Scope and Remedies for the Merger
The merger in Northern Ireland is part of a broader proposed deal between ABF and Hovis covering their UK operations.
However, the CMA noted that the deal does not raise competition concerns within the bread market in Great Britain.
ABF and Hovis have until 9 April to respond to the CMA’s concerns regarding the Northern Ireland market.
One possible solution is for ABF to divest its Northern Ireland business to a third party.
The CMA report highlighted that ABF is currently conducting a sales process for its Northern Ireland business, with several interested parties having submitted non-binding offers.
It also mentioned that this business presents an opportunity for other suppliers, including those based in the Republic of Ireland, to enter or expand in the Northern Ireland market.
Statements from ABF
ABF issued a statement saying:
"We will continue to engage constructively with the CMA, including with regard to our Northern Ireland business, so that we can achieve regulatory clearance as efficiently as possible."
