Demerger of organic dairies Andechser and Söbbeke

As a result of a merger control proceeding conducted by the Bundeskartellamt, the two largest organic dairies in Germany – Andechser Molkerei Scheitz GmbH and Molkerei Söbbeke GmbH – will again compete independently of one another in the market in future. The two dairies were integrated under the large French dairy Savencia SA. Savencia, known until recently under the name of Bongrain, markets among other products several conventionally manufacturered types of cheese such as Bresso, Chaumes, Fol Epi, Géramont, Le Tartare, and Saint Albray. In 1999 the company acquired shares in Andechser and between 2011 and 2013 also acquired Söbbeke. Savencia only succeeded in having the merger cleared in merger control proceedings in 2011 by submitting incorrect information. Once it realized that the company had given false information the Bundeskartellamt initiated divestiture proceedings and carried out extensive investigations at the companies concerned and at all the organic dairies in Germany.

Andreas Mundt, President of the Bundeskartellamt: "Companies which notify the Bundeskartellamt of a merger for examination are obliged to submit comprehensive and above all correct information. The Bundeskartellamt's efficient and swift examination of merger projects depends, not least in the interests of the companies, on the submission by the parties of a complete and correct notification. If it later becomes apparent that a company has not fulfilled these duties, the authority has effective means at its disposal to reinstate the legitimate state of affairs at a later date. A divestiture proceeding can also end in the Bundeskartellamt ordering the merger to be reversed."

The results of the investigations have confirmed that from a competition perspective a distinction has to be made between product markets for conventionally produced milk products and those for organic milk products. The two dairies achieve joint market shares of well over 50% with the different products of the so-called "white line", in particular organic fruit yoghurt and natural yoghurt as well as organic fruit quark and organic drinks. According to the findings of the Decision Division the former merger significantly impeded effective competition on several markets.

Savencia's notification in 2011 did not at all correctly reflect the market situation and also contained incomplete information on further possibilities of the Bongrain group to exert influence on Andechser Molkerei Scheitz GmbH. In reply to further queries during the first phase proceedings it also submitted incorrect sales figures.

The Bundeskartellamt has informed the parties of its preliminary findings. In order to avoid the dissolution of the merger between Savencia and Söbbeke, which in the authority's view was necessary, Savencia offered to give up its participation in Andechser and to sell its shares. This measure has now been implemented with the result that the Bundeskartellamt was able to end the divestiture proceedings against Savencia/Bongrain and Söbbeke.

Any person, who intentionally or negligently fails to notify a concentration correctly and completely, commits an administrative offence under the German Competition Act (GWB) which is punishable with a fine.