Patties Foods Pty Ltd - National Pies Pty Ltd

Summary

Patties Foods Pty Ltd (Patties) is seeking to acquire National Pies Pty Ltd (National Pies).

Patties is a producer and wholesale supplier of primarily frozen packaged meals, savoury products and sweets in Australia and New Zealand. Patties’ retail brand names include Four’N Twenty, Patties Foods, Herbert Adams, On The Menu, Lean Cuisine, Fitness Outcomes, Weight Watchers, Leader, Leggo’s, and Nannas. It also manufactures private label, corporate branded and other branded products.

National Pies is a producer and wholesale supplier of primarily chilled savoury products (mainly pies, sausage rolls and pasties) in Australia. National Pies also supplies some customers with frozen savoury products.

Market definition

The ACCC considered the potential effect of the proposed acquisition on competition in the markets for:

• the wholesale supply of frozen savoury products; and
• the wholesale supply of chilled savoury products.

For the purposes of this assessment, the ACCC did not need to reach a concluded view on the precise definitions of each market. However, the ACCC’s investigation found that there was not close substitution between frozen savoury products and chilled savoury products. ‘Savoury products’ includes pies, sausage rolls and pasties.

Competition analysis

The ACCC concluded that the proposed acquisition is not likely to substantially lessen competition in any relevant market in Australia.

The ACCC found that, while the parties overlap in the wholesale supply of frozen savoury products, National Pies’ offering is limited. The ACCC also found that National Pies was unlikely, in the absence of the proposed acquisition, to expand its supply of frozen products to such an extent that it would provide a strong competitive constraint on Patties.

The ACCC also considered that the merged entity was likely to be competitively constrained by existing suppliers of frozen savoury products, including supermarkets’ private label products.