Japan’s Mizkan has promised to sell its production plant in Burntwood, Staffordshire, to address competition concerns raised following its purchase of Premier Foods’ vinegar and pickles business.
“The companies are the two leading suppliers of malt and spirit vinegars in the UK, especially to food processor customers and supermarkets,” said OFT senior director Ali Nikpay.
“A number of these customers told us that the transaction would result in the merged entity having a monopoly position and would therefore result in price increases.”
In order to meet the OFT’s concerns, Nakano will sell its Burntwood production facility to an upfront buyer to be approved by the OFT.
Nikpay added: “We are now considering Nakano’s offer to sell its Burntwood plant to address our competition concerns.”
Prior to the merger, Mizkan’s vinegars division Nakano and Premier both manufactured and supplied unbranded malt and spirit vinegars, as well as supplying unbranded wine and cider vinegars in the UK. Premier also supplied branded malt and wine vinegar and pickles under the Sarson’s, Dufrais and Haywards brands.
The £41m sale was completed in July, continuing Premier’s efforts to reduce its debt and focus on a handful of core ‘Power Brands’.
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