The European Union yesterday approved Mars's multibillion-dollar acquisition of snack food business Kellanova, saying an antitrust probe found the transaction would not raise competition concerns. The European Commission, the EU's a
AFP | Brussels
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The European Union yesterday approved Mars’s multibillion-dollar acquisition of snack food business Kellanova, saying an antitrust probe found the transaction would not raise competition concerns.
The European Commission, the EU’s antitrust regulator, had launched an investigation in June over concerns that the transaction would lead to higher prices for consumers.
But this concluded that Mars, the maker of M&M’s and Snickers, would not benefit from much stronger bargaining power with retailers as a consequence of the purchase.
“We looked very carefully at this deal to make sure that Mars would not gain extra power over retailers, power that could lead to for example higher prices for shops and, ultimately, for consumers,” European Union competition chief Teresa Ribera said.
“Our review found no evidence that this risk exists, so we have decided to approve the acquisition.” The commission argued this was due to the fact that Kellanova’s products, which include Pringles and Pop-Tarts, have a long shelf life and are usually “the object of impulsive and infrequent purchases”.
And snack-buyers were unlikely to start shopping at a different store if the two firms’ products were to become unavailable at their local supermarket.
The deal was approved unconditionally.
Mars’s $35.9 billion all-cash purchase of US-based Kellanova was announced in August last year.
Mars, which is also headquartered in the United States, said at the time the acquisition would bring two new billion-dollar brands, Pringles and Cheez-It, into its snacks portfolio.
The US Federal Trade Commission meanwhile had approved the merger earlier this year saying it posed no violation of antitrust law in the United States.
