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Sunday April 21, 2024

CCP approves acquisition of Fauji Cereals business

CCP’s assessment of pre-merger application indicated that there were no overlaps between merging parties in areas of business activities such as Breakfast Cereals and Wheat

By Mehtab Haider
February 21, 2024
The logo of the Competition Commission of Pakistan. — The CCP Website
The logo of the Competition Commission of Pakistan. — The CCP Website

ISLAMABAD: The Competition Commission of Pakistan (CCP) has approved the acquisition of M/s Fauji Foundation’s Fauji Cereals Business by M/s Fauji Foods Limited.

The Fauji Foundation, established as a charitable trust for the welfare of ex-servicemen and their families, submitted a pre-merger application to the CCP under Section 11 of the Competition Act, 2010.

According to the CCP’s announcement here on Tuesday stating that the proposed transaction involves the acquisition of the Fauji Cereals Business by M/s Fauji Foods Limited through a Business Transfer Agreement. M/s Fauji Foods Limited is a publicly listed company incorporated in Pakistan, primarily focused on the production and sale of dairy and allied products.

CCP’s assessment of the pre-merger application indicated that there were no overlaps between the merging parties in the areas of business activities such as Breakfast Cereals and Wheat, Barley & Porridge. Therefore, the CCP concluded that market conditions will remain unchanged post-transaction, with no significant alteration to the competitive landscape in these product categories.

Following competition assessment, CCP concluded that the proposed transaction involves the acquisition of shares and does not suggest any substantial lessening of competition or the creation or strengthening of a dominant position in the relevant market. Restructuring will ensure the Breakfast Cereal business is consolidated under one arm and result in future profitability.