Commission clears rendering merger

21 October 2016

Commission clears rendering merger

The Commerce Commission has given clearance to the Wallace Group Limited Partnership to acquire up to 100% of the assets and business of Wallace Corporation Limited, Farm Brands Limited (and related companies) and Keep It Clean Limited.

The merging parties are involved in the rendering of animal waste materials into finished products, such as animal feed.

The Commission considered the impact of the acquisition on various buying markets. Namely it looked at the purchase of mixed animal material from shops in Canterbury, the purchase of mixed casualty material in the lower South Island and the direct purchase by individual species from meat processors in the Canterbury region. It also considered the effects on two selling markets: the supply of toll rendering services of animal material on behalf of customers and the supply of various finished rendered products, including meat and bone meal.

Chairman Dr Mark Berry said the Commission is satisfied that the acquisition will not have, or would not be likely to have, the effect of substantially lessening competition in the affected markets.

“In shop collection and the direct collection of pork material, the Commission considers that the merger is unlikely to result in any significant change to the competitive situation. In the other affected markets, we consider that suppliers of animal materials would continue to have alternative options after the merger,” said Dr Berry.

A public version of the written reasons for the decision will be made available on the Clearances register when ready.

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