AUSTRALIA | The ACCC will not oppose Australian Health & Nutrition Association Limited's (Sanitarium) proposed acquisition.
The ACCC will not oppose Australian Health & Nutrition Association Limited's (Sanitarium) proposed acquisition of the brand and intellectual property assets necessary for the supply of Vita Brits from Société des Produits Nestlé S.A. and Nestlé Australia Ltd (together, Nestlé).
Sanitarium manufactures and supplies Weet-Bix and private-label wheat biscuit cereals. Nestlé (under the Uncle Tobys brand) supplies Vita Brits, a competing product, but currently, Sanitarium manufactures Vita Brits.
The proposed acquisition involves Vita Brits branding, intellectual property and goodwill. It does not include Uncle Tobys branding or any manufacturing assets.
The ACCC’s review focused on how closely Weet-Bix and Vita Brits compete in the wholesale supply of wheat biscuit cereal and the future of the Vita Brits product should Sanitarium not acquire it.
Its analysis of data to assess whether consumers would switch between Weet-Bix and Vita Brits products in response to price changes indicated that, although the products are similar, Vita Brits is unlikely to be a strong competitive constraint on Weet-Bix in the absence of the proposed acquisition.
“We tested the closeness of competition between the Weet-Bix and Vita Brits products and found that consumers do not typically switch between the two,” said ACCC Commissioner Dr. Philip Williams.
“This finding was consistent with the feedback we received from market inquiries. We found that the proposed acquisition would not be likely to lessen competition substantially.”
The ACCC also closely considered the viability of Vita Brits products without the acquisition, following Nestlé's loss of Vita Brits manufacturing capability.
