ABP Food Group
A consultant’s report raises specter of negative impact on competition in Ireland’s beef sector.

DUBLIN – Irish meat processor ABP Food Group has eyed Slaney Foods International as an acquisition target since late 2015, and the companies recently notified the European Commission of plans for ABP Foods to acquire a 50 percent stake in Slaney Foods.

Both companies are significant players in the Irish beef processing industry. ABP Food Group in Ardee, Ireland, specializes in beef processing, de-boning and retail packing, and is a leading supplier of a range of frozen lamb, pork and beef products. In 2015, Sysco Corp. and ABP reached an agreement for ABP to supply Irish beef to Sysco Metro New York and Sysco Boston locations.

Slaney Foods, based in Wexford, Ireland, offers carcass and primal cuts of beef, chilled and frozen beef, ribeyes, striploins and minced meats. The company also exports lamb products.

But a farmers’ trade group has expressed concerns about potential negative impacts on competition in the Irish beef sector; and a consultant’s analysis of potential competition effects of the proposed tie-up have fueled producer backlash against the transaction.

A 132-page report from PMCA Economic Consulting examined competition in the current competition environment in Ireland’s meat processing sector in with particular focus on key cattle, lamb and sheep procurement markets.

PMCA found that in 2015, ABP operated six processing plants, at Bandon, Cahir, Clones, Nenagh, Rathkeale and Waterford, and that the company accounted for 21 percent of the total national beef slaughter that year.

Including ABP, there are four processors in the Irish meat processing market. “After the four multi-plant firms, Slaney is the next largest firm in the relevant market, with an estimated market share of 5.3 percent...” PMCA said in its report. “Its facility at Bunclody is the largest beef processing plant in the country, with more than 88,000 head of cattle slaughtered there in 2015.”

If the merger receives approval, the report said, ABP and Slaney would end up controlling nearly 26 percent of all cattle slaughtered in Ireland and more than 36 percent of the premium cattle market in Ireland.

 In a statement, Joe Healy, president of the Irish Farmers Association, urged Agriculture Minister Michael Creed to formerly request that Ireland’s Competition and Consumer Protection Commission (CCPC) investigate the merger and potential impacts on competition.

“Minister Creed cannot allow the Irish competition authority to escape their responsibilities and pass the buck onto Brussels,” Healy said. IFA forwarded copies of the PMCA report to various competition authorities in Ireland and the United Kingdom.

ABP released a statement confirming the 50-50 joint venture with Slaney Foods and acknowledging the IFA’s concerns. “The company is aware of the IFA report and is confident that the transaction will be approved in the coming months. It is not appropriate for us to comment further while this process in ongoing.”