The Italian Competition Authority opens a Second Phase investigation into a merger in the canned food sector
The proposed Bolton acquisition of Simmenthal from Kraft attracted the attention of the Italian Competition Authority (ICA). As the ICA feared that the transaction would have anticompetitive effects in the market for processed meat, it has opened a Second Phase investigation into it (CaseC11799, Bolton/Simmenthal) . The relevant markets affected by the merger are the market for the production and retail of canned meat and tripe with tomato sauce. All these markets have a similar competition structure. With a market share constantly higher than 60% over the past three years Simmenthal is the leading player in these markets and probably it also enjoys a dominant position. Bolton is the next competitor to Simmenthal , though its market shares are much lower not exceeding 20%. The ICA believed that the execution of the merger would strengthen the market power of Bolton leading to the creation or the strengthening of a dominant position for two reasons. First, due to the overlapping of...