The ACCC will not oppose Lion’s proposed acquisition of Fermentum.
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Fermentum and Lion manufacture a range of alcoholic and nonalcoholic beverages including beer, cider, alcoholic seltzer and kombucha.
The Australian Competition and Consumer Commission focused its investigation on whether the acquisition would substantially lessen competition in the supply of beer, given Fermentum’s popular flagship brand Stone and Wood.
The ACCC concluded that overall, the Fermentum brands do not compete closely with Lion’s products, as Fermentum’s products are generally in a higher price bracket and Lion’s craft style brands are generally perceived as mainstream.
The ACCC conducted a large number of market inquiries with customers, competitors and industry bodies, which did not raise strong competition concerns.
The ACCC’s investigation also considered whether the proposed acquisition would stop the growth of independent brewers, or otherwise restrict their ability to access beer taps in hospitality venues or shelf space at liquor stores.
The ACCC understands that Stone and Wood would no longer be eligible for the taps reserved for independent brewers after the acquisition. Therefore, it is likely other independent brewers will be able to take up many of the taps that were previously Stone and Wood independent taps.
During the investigation, a number of market participants raised concerns that the packaging of beer made by the major breweries may confuse consumers about who ultimately owns the company that made the beer.
“Consumers that wish to purchase independent craft beer should carefully read the information provided on the label, or ask the person serving them if the beer is made by an independent brewer,†ACCC Commissioner Stephen Ridgeway said.
Separate to the potential impact of Lion’s proposed acquisition of Fermentum, the ACCC continues to hear concerns from the industry about the exclusivity agreements limiting the ability of independent brewers to compete in general. ■