The Australian Competition and Consumer Commission has decided not to oppose a merger between Consolidated Meat Group and Teys Bros, ACCC Chairman, Professor Allan Fels, said today.
CMG and Teys Bros are both large meat processors. Between them they operate abattoirs for the slaughter of cattle and own related assets in Queensland and South Australia, with an emphasis on the processing of export beef.
"The ACCC consulted competing abattoirs and meat processors, and domestic buyers of processed beef", Professor Fels said. "Market participants indicated that the merger of CMG and Teys Bros was unlikely to lead to a reduction in competition in terms of the prices that producers were likely to receive for their cattle, or in terms of the processing and supply of processed meat for domestic consumption.
"The ACCC notes the recently announced closure of CMG's Lakes Creek plant at Rockhampton, reportedly due to unprofitable operations. Some market participants have expressed the view that the merger between CMG and Teys Bros may ensure the continued competitiveness of these companies in the Australian meat processing sector.
"The ACCC's predecessor, the Trade Practices Commission, took a strong stand in support of competition in the Queensland meat processing sector in 1988 when it successfully opposed a merger between Australian Meat Holdings and Thomas Borthwick and Sons. The ACCC will continue to be interested to ensure that any future rationalisation in the meat processing industry will not adversely affect competition".