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Divestment of production facilities proves necessary for the approval of agricultural inputs merger

24. juni 2015

Danish Agro commits itself to divest two production facilities to receive the approval of the merger with Dan Agro, which owns Hedegaard Agro. The merger was approved by the Danish Competition Council today.

The Director General of the Danish Competition and Consumer Authority, Agnete Gersing, states:

“As a consequence of the merger, the market for poultry feed, which is already characterised by having few, large companies, loses an independent competitor. The commitment of Danish Agro to divest two of its production facilities makes it possible for other suppliers of agricultural inputs to either enter the market or to expand”

The Competition Council approves the merger on the condition that Danish Agro divests two of its feed production facilities – both holding a license to produce poultry feed – to Hornsyld Købmandsgaard and Mollerup Mølle as of today.

Additionally, Danish Agro commits itself in a range of other areas. Among other things, the company will provide other suppliers of agricultural inputs with the opportunity to sign contracts with Danish Agros cus-tomers on the market for poultry feed for a 5 month period starting immediately after the merger.

Danish Agro has provided a total of nine commitments, which are binding. The Competition Council assesses that the commitments accommodate the competition concerns raised by the merger.

Danish Agro and Hedegaard Agro are both active on the markets for production and sale of feeding stuff for pigs, cattle and poultry as well as sale of fertilizer, seed grain, premix, feed ingredients, etc. to farmers.

Before the merger, Danish Agro holds more than 50 per cent of the shares in Dan Agro, which owns Hedegaard Agro. However, due to a voting ceiling in the company’s articles of association, Danish Agro does not have control over Dan Agro.

Related material

Read the Competition Council’s decision regarding the merger between Danish Agro a.m.b.a. and Dan Agro Holding A/S (Hedegaard) (Danish)

Last updated: 24. juni 2015