Oceana and V&A Cold Store takeover approved

The Competition Commission and the merging parties redrafted some of the details of the conditions they had agreed upon‚ when asked for more clarity by the tribunal.

Tribunal chairman Norman Manoim expressed concerns about some of the wording being to loosely drafted‚ leaving it open for interpretation that could see competitors of the merging party being denied access to storage facilities.

The tribunal approved the transaction after receiving the redrafted conditions.

The merger brings about the removal of a competitor in the storage market‚ giving the merged entity a dominant position in the market for quayside cold storage and handling of loose and frozen packaged fish.

The commission's investigation into the merger showed that quayside cold storage facilities were generally under-utilised and that there was capacity available to third party fish customers.

In order to maintain the continued access to storage facilities the commission and the merged parties agreed that quayside firms would ensure that Oceana and its subsidiaries did not exceed 50% of the storage capacity at their quayside facilities.

The quayside firms included all the entities that provide cold storage at the quayside as a result of the merger.

The merged firm will be allowed to exceed the 50% storage quota (7‚250 pallet spaces)‚ provided it does not have a negative impact on the third party fish customers.

If the limitation of access to third party fish customers does have a negative impact‚ the quayside firms must provide written notice to the customers indicating the reasons and the duration of the increased utilisation.

This notice must be provided at least 72 hours before the increase in capacity use starts. The commission and the merged parties agreed that the time in which they could exceed the 50% target should be limited to six weeks.

Michelle le Roux‚ representing the commission before the tribunal‚ said its analysis of the utilisation information indicated that it was only on very rare occasions that the storage usage of the merged parties would exceed 50%. It had happened only once in the last three years.

She said in the event of any change in the availability of cold storage facilities the commission had the obligation to reconsider the conditions allowing it to lift‚ revise or amend them.