Food and Beverage Business
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Saputo dairy plants sale to Coles approved by Australian regulator

Saputo dairy plants sale to Coles approved by Australian regulator Coles Group, Saputo Food and Beverage Business

The Australian Competition and Consumer Commission (ACCC) has approved the acquisition of two milk processing plants owned by Canadian dairy giant Saputo by national retailer Coles Group. The decision was initially set to be made in September but was delayed due to unaddressed concerns from relevant parties. This acquisition will heighten the retail group’s bargaining position in the dairy supply chain, but the ACCC has determined that it is unlikely to result in a substantial lessening of competition in breach of section 50 of the Competition and Consumer Act.

Concerns have been raised about how the acquisition may affect competition for other processors, pushing Saputo to leave the raw milk market in New South Wales altogether and cut the number of raw milk buyers. Despite these worries, the ACCC has concluded that the acquisition will not have a substantial impact on competition in the dairy industry and will therefore be approved.

The Business Council of Co-operative and Mutuals (BCCM) has expressed concerns about the proposed acquisition, as it is likely to significantly reduce competition in the dairy market to the detriment of both consumers and family farmers. However, the ACCC believes that the protection for Coles’ dealings with processors and farmers already exists through the Dairy Code of Conduct and the Food and Grocery Code of Conduct, ensuring fair competition in the industry.

Overall, the ACCC has approved the acquisition of the two milk processing plants by Coles Group and Saputo. Despite concerns from stakeholders, the ACCC believes that the acquisition will have minimal impact on competition in the dairy industry. The regulatory body will ensure that Coles and Saputo adhere to existing codes of conduct to maintain fair and competitive practices in the food and beverage industry.

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