PCC approves Johnsonville-Frabelle deal

Anti-trust watchdog Philippine Competition Commission (PCC) has given the go-ahead for US company Johnsonville International LLC to acquire over half the outstanding stock in local food processing company Frabelle Corporation.

In its decision dated May 7, the PCC said the acquisition will not pose a threat to competition in the Philippines, as Frabelle's production volume is "negligible."

"Upon review of the findings and recommendation of the Mergers and Acquisitions Office and the Parties' submissions, the Commission finds that the proposed acquisition by Johnsonville of shares in Frabelle will not likely result in substantial lessening of competition," the PCC decision read.

This was signed by PCC Chairman Arsenio Balisacan, and Commissioners Johannes Benjamin Bernabe, Amabelle Asuncion, and Macario De Claro, Jr.

Johnsonville is a US company engaged in manufacturing, packaging, and distribution of fresh, chilled and frozen meat products, most notably of sausages in Philippine stores under the brand name of “Johnsonville.”

Frabelle Corporation is a Philippine company engaged in the manufacturing, packaging, and distribution of fresh, chilled and frozen processed meat products, including hotdogs and sausages under the brand name “Frabelle.”

"[P]ost-transaction, Frabelle's production volume in the candidate relevant market for sausages is negligible, such that even if combined with the pre-existing production volume of Johnsonville, will not or is not likely to result in significant change in market structure," the PCC said.

The competition agency said the transaction will have "minimal" changes in the relevant market for hotdogs and sausages, and the transaction does not strengthen the ability of parties to engage in input or customer foreclosure.

"This decision is rendered solely on the facts disclosed and circumstances of the proposed transaction and documents submitted by Johnsonville and Frabelle," it said. — Jon Viktor D. Cabuenas/BM, GMA News