The Netherlands Authority for Consumers and Markets (ACM) has cleared the acquisition of the Dutch activities of veal company Van Dam by rival company Van Drie Group.
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Following an extensive investigation into the acquisition, ACM has determined that it is not likely that the acquisition will lead to lower purchase prices of calves or to foreclosure of competitors.
The Van Drie Group is active in the entire production chain in the veal sector. Van Drie’s main activities include the production of feed for calves, buying of young calves, calf husbandry, calf slaughterhouses, and the selling (export) of veal.
The Van Drie Group is the market leader in the veal sector. Van Dam’s main activities include buying and selling calves, and calf husbandry.
ACM has assessed whether, as a result of the acquisition, the Van Drie Group could lower the purchase prices it pays to dairy farmers and traders for their young calves. Lower prices can, particularly in the long term, lead to fewer investments in, for example, sustainability and animal welfare.
However, it is unlikely that the acquisition will result in lower purchase prices. Dairy farmers and traders are able to switch to competitors.
ACM has also assessed whether, as a result of the acquisition, the Van Drie Group is able to lower the purchase price of fattened calves. That does not seem to be the case. In that case, suppliers of fatted calves, too, will be able to switch to competitors.
Although the Van Drie Group is already the market leader in the calf sector, this acquisition does not have any major consequences for competition in the entire veal production chain.
It is not likely that the Van Drie Group is able to foreclose competitors from the market, for example, by temporarily raising its payments to dairy farmers and traders when buying calves. ■
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