CMA raises competition concerns in chilled sauces market while clearing Italian operations

The Competition and Markets Authority (CMA) has raised significant competition concerns regarding the proposed £1.2 billion ($1.61 billion) merger between convenience food manufacturers Greencore Group and Bakkavor Group, specifically targeting potential anti-competitive effects in the UK's chilled sauces market.

Regulatory Assessment and Market Concentration Issues

In its preliminary Phase 1 assessment, the CMA identified that the merger could substantially reduce competition in the supply of own-label chilled sauces, potentially positioning the combined entity as one of the UK's largest suppliers in this specialized market segment.

The regulator's analysis revealed limited competitive alternatives, with only 2 Sisters Food Group and Billington Foods identified as other substantial competitors in the chilled sauces space. However, the CMA characterized both companies as weaker rivals compared to the proposed Greencore-Bakkavor combination.

Partial Market Clearance

Despite concerns in the UK chilled sauces market, the CMA has cleared the merger for Italian markets covering chilled ready meals and salads. This partial clearance demonstrates the regulator's nuanced approach to market evaluation, recognizing that competitive dynamics can vary significantly across geographic regions and product categories.

The differential treatment highlights the complexity of modern food industry consolidation, where companies operate across multiple markets with varying competitive landscapes.

Leadership Response and Strategic Vision

Greencore CEO Dalton Philips expressed satisfaction with the regulatory progress, stating: "The CMA process has been constructive and the Phase 1 decision is a welcome one, confirming our view of the highly complementary nature of our businesses and product portfolios across 'food for now' and 'food for later'."

Philips emphasized the strategic rationale behind the combination: "We are now working with the CMA and Bakkavor for the benefit of all our stakeholders to complete the Bakkavor transaction early next year. I'm genuinely excited about what 2026 has in store as we bring these two great businesses together to create a true UK national food champion to deliver high-quality, innovative food to customers and consumers."

Bakkavor CEO Mike Edwards reinforced the positive outlook: "Today's positive news from the CMA is a significant step forward in the process, providing welcome clarity which means we can collectively work at pace and stay on track to complete the transaction in early 2026."

Remedies Process and Timeline

Both companies have until November 3, 2025, to propose remedies addressing the CMA's competition concerns in the chilled sauces market. The companies remain committed to completing the transaction in early 2026, subject to satisfactory resolution of regulatory issues.

The remedies process will likely focus on addressing market concentration concerns while preserving the strategic benefits of the merger for both companies and consumers.

Broader Regulatory Context

The CMA's intervention reflects the UK's increasingly vigilant approach to maintaining competitive markets, particularly in essential consumer goods sectors like food manufacturing. This scrutiny aligns with broader global trends toward stricter antitrust enforcement in food and beverage industry consolidation.

The case demonstrates how regulators are applying sophisticated market analysis to evaluate the competitive effects of mergers across different product categories and geographic markets.

Industry Implications

The proposed merger would create a significant convenience food powerhouse with combined operations spanning ready meals, salads, and chilled sauces. The transaction represents one of the largest food industry consolidations in the UK market this year.

Success in addressing regulatory concerns could establish a template for future food industry mergers, while failure might signal increased regulatory resistance to large-scale consolidation in essential food categories.