Juice merger could be orange squashed after CMA warns of reduced competition and higher prices
A merger between the country's two biggest suppliers of freshly squeezed fruit juice may have to undergo a thorough probe after an initial investigation found it could lead to higher prices for retailers and consumers.
Hain Frozen Foods UK bought Orchard House Foods on 21 December, but they are the only two suppliers to supermarkets in the country – other suppliers have just "limited sales to the food service retailers such as cafes and restaurants".
As other firms are not planning to enter the void, the competition watchdog has said the merger raises competition concerns, specifically around creeping prices.
Sheldon Mills, CMA's senior director of mergers and the decision-maker in this case, said:
Fruit juices are an increasingly popular purchase for UK consumers, in supermarkets, cafes and restaurants. Freshly squeezed juices are different in taste, quality and price from other concentrate juices.
This merger removes the rivalry between two long-standing suppliers of freshly squeezed fruit juice to supermarkets and food service retailers.
Therefore, unless acceptable undertakings are offered, this merger will be referred for an in-depth investigation to ensure that it does not result in higher prices or worse quality for retailers and consumers.
The merged entity would also supply a significant share of prepared fruit to supermarkets and other retailers, but there is "sufficient competition from other suppliers", the CMA found.