UK – French firm Cérélia, a Puff pastry giant, has been denied the green light to purchase Jus-Rol over concerns it may leave UK retailers and shoppers facing “higher prices and lower quality products.”

The UK Competition & Markets Authority (CMA) has further directed Cerelia to sell the business which it acquired from General Mills. Inc in January 2022.

The decision was reached following a 7-month investigation by the British competition regulator which identified possible competition concerns after an initial Phase 1 inquiry.

“Cérélia and Jus-Rol are the biggest players in this market by far and losing the competition that takes place between them could result in monopoly price forcing customers to face higher prices and worse quality products”

According to a statement from the CMA, Just-Rol is the largest supplier of branded ready-to-bake products in the UK, while Cérélia is the biggest supplier of own-label ready-to-bake products, making these items on behalf of some of the nation’s largest grocery retailers.

According to the verdict, the CMA’s probe found that the two businesses face limited competition from smaller players in the market and the merger could leave UK retailers and shoppers facing higher prices and lower-quality products.

The CMA claims that while there are differences between the companies’ products, Jus-Rol items compete with supermarkets’ own-label products supplied by Cérélia for the same space on many supermarket shelves.

Meanwhile, Cérélia has contested the ruling by the UK’s competition citing “relying on flawed conclusions”

In its filing, Cerelia noted that the CMA’s final report suggests that the outcome is largely based on uncorroborated and unreliable concerns raised by a very small number of supermarkets whose opinions were not echoed by the vast majority of other retailers.

The French firm also lamented the deal that turned out to be a complex transaction since Cérélia first submitted a proposal in November 2021 to acquire Jus-Rol’s European business from US-based General Mills.

The company criticized the CMA for a “persistent lack of understanding of the structure and competitive dynamics of the industry in which Cérélia operates”.

Moreover, the company said that its aim with Jus-Rol was to provide “retailers and consumers with more options at competitive prices” and has also invested a “significant” amount in the Jus-Rol factory in Corby, in the East Midlands county of Northhamptonshire.

Guillaume Reveilhac, president Cérélia said that “We are deeply disappointed by today’s fundamentally flawed decision and the decision cannot be rationalized.”

He also said that “Rather than protecting the interests of UK consumers and the UK economy in these difficult times, the CMA decision blocks much-needed investment into new and exciting affordable products in the UK home-baking segment.

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