A PYMNTS Company

UK’s CMA Raises Concerns Over Boparan’s Feed Mill Acquisition

By  |  November 6, 2024

The UK’s Competition and Markets Authority (CMA) has raised alarms about the potential effects of Boparan Holdings’ proposed acquisition of a Dutch agricultural feed mill site in Burston, owned by ForFarmers. According to Reuters, the CMA’s initial investigation suggests that the deal could reduce competition in the poultry supply market, leading to higher feed costs for chicken farmers and processors in East Anglia.

    Get the Full Story

    Complete the form to unlock this article and enjoy unlimited free access to all PYMNTS content — no additional logins required.

    yesSubscribe to our daily newsletter, PYMNTS Today.

    By completing this form, you agree to receive marketing communications from PYMNTS and to the sharing of your information with our sponsor, if applicable, in accordance with our Privacy Policy and Terms and Conditions.

    The watchdog’s concerns stem from the fact that the acquisition could give Boparan, which also owns the 2 Sisters Food Group, increased market power in the region. 2 Sisters is a major supplier of frozen poultry and ready-to-eat meals to large retailers such as Tesco, M&S, and Aldi. The CMA indicated that this could hurt rival poultry meat producers and ultimately drive up prices for local farmers, potentially affecting food prices for consumers.

    Joel Bamford, the CMA’s executive director of mergers, commented, “We’re concerned that this deal could worsen competition between poultry feed suppliers in East Anglia – leading to higher costs for farmers, which could then be passed down to shoppers,” as per Reuters.

    We’d love to be your preferred source for news.

    Please add us to your preferred sources list so our news, data and interviews show up in your feed. Thanks!

    Add as Preferred Source

    Related: UK Regulator Puts Brakes on £762 Million Logistics Merger Amid Competition Fears

    Boparan’s planned acquisition is not the first attempt to enter the feed supply market. In 2022, the CMA investigated a proposed joint venture between Boparan and ForFarmers due to similar competition concerns but dropped its investigation after the companies abandoned the venture. Since then, Boparan has proceeded to purchase ForFarmers’ feed mills in Burston and Radstock. However, the CMA has noted that no competition concerns arose from the Radstock acquisition.

    The regulatory body also raised worries over the Burston site, where the deal could reduce capacity for independent farmers and limit access to poultry feed, impacting feed quality and service. Boparan’s subsidiary, 2Agriculture, supplies poultry across Scotland, East Anglia, and North Wales, operating alongside ForFarmers’ feed mills in East Anglia.

    In light of these findings, Boparan and ForFarmers have been given five working days to propose remedies to address the competition issues. If they fail to provide satisfactory solutions, the CMA will escalate the investigation to a more detailed Phase 2 review.

    As the situation develops, the watchdog’s actions could have significant implications for the poultry industry in the UK, especially in terms of pricing and the availability of feed for independent poultry farmers in the region.

    Source: Reuters