CELEX: 32013M6753
Language: en
Date: 2013-03-04 00:00:00
Title: Commission Decision of 04/03/2013 declaring a concentration to be compatible with the common market (Case No COMP/M.6753 - ORKLA / RIEBER & SON) according to Council Regulation (EC) No 139/2004 (Only the English text is authentic)

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                                        Brussels, 4.3.2012
                                        C(2013) 1328 final

            To the notifying party:

Dear Sir,

Subject:    Case No COMP/M.6753 – ORKLA/ RIEBER & SØN
         Commission decision pursuant to Article 6(1)(b) of Council Regulation No 139/2004[1]

 1. On 28 January 2013, the European Commission received a notification of a proposed concentration pursuant to Article 4 of Council  Regulation
    (EC) No 139/2004 ("the Merger  Regulation")  by  which  the  undertaking  Orkla  ASA  ("Orkla",  Norway)  acquires  within  the  meaning  of
    Article 3(1)(b) of the Merger Regulation sole control of the whole of the undertaking Rieber & Søn ("Rieber", Norway) by way of purchase  of
    shares.[2] Orkla is hereinafter referred to as the "Notifying Party", whereas Orkla and Rieber together are referred to as the "Parties".

1. THE PARTIES

 2. Orkla is a group of companies headquartered in Oslo, Norway. It is listed on the Oslo Stock Exchange. Orkla is divided into  three  business
    areas: (i) Sapa, which is active in the manufacture and sale of aluminium profiles, heat transfer and building systems[3], (ii) Investments,
    which manages the group's financial investments, and (iii) Orkla Brands, which is active in the processing and sale of food, drink and snack
    products to retail shops and food service[4] customers, as well as in the production and sale of  detergents  and  personal  care  products,
    cleaning solutions, dietary supplements, health products and basic textiles.

 3. Rieber is a group of companies operating in the food sector, headquartered in Bergen, Norway. It is also listed on the Oslo Stock  Exchange.
    Rieber is a supplier of branded food products, primarily to the grocery and out of home channels.

2. THE OPERATION

 4. On 19 August 2012, Orkla and several investment companies owned by the Rieber family entered into an  agreement  according  to  which  Orkla
    intends to acquire 90.11% of the shares in Rieber. This acquisition will trigger a mandatory offer for the  remaining  shares  on  the  Oslo
    Stock Exchange.

 5. The proposed transaction therefore constitutes a concentration within the meaning of Article 3(1)(b) of the Merger Regulation.

3. EU DIMENSION AND PARTIAL REFERRAL TO NORWAY

 6. The notified operation has an EU dimension within the meaning of Article 1(3) of the Merger Regulation.[5]

 7. By reasoned submission of 4 January 2013, Orkla requested in accordance with Article 6 of Protocol 24 to the EEA Agreement that the proposed
    transaction be referred to the competent Norwegian authorities as regards the Norwegian part of the transaction. Following the agreement  of
    Norway to the referral request on 22 January 2013, the Commission adopted a decision on 25 January 2013  referring  the  assessment  of  the
    effects of the proposed transaction on the relevant markets in Norway to the Norwegian Competition Authority.

 8. Therefore, only the remainder of the transaction, which primarily concerns Sweden and Denmark[6], will be assessed by the  Commission.  This
    decision is without prejudice to the outcome of the proceedings conducted by the Norwegian Competition Authority in charge of the assessment
    of the effects of the proposed transaction on the relevant markets in Norway.

   4. COMPETITIVE ASSESSMENT

   1. Horizontal overlaps

 9. The Parties are active in the production and supply of a different range of products in the retail and the food service segment  in  Denmark
    and Sweden. However, only the following products are affected by the proposed transaction: (i) ketchup, mustard (retail and  food  service),
    (ii) frozen cakes and soup (retail), and (iii) wet hot sauces and other cold sauces (food service).

   1. Relevant product markets

10. According to the Commission's established decisional practice, with which the Notifying Party concurs, a distinction must  be  made  between
    the production and sale of food products dedicated to (i) the retail sector and (ii) the catering sector (food service sector).[7]

   1. Retail sector

11. The Notifying Party submits that the definition of the relevant product markets in the retail sector is principally  made  by  reference  to
    demand-side characteristics, i.e. the products' characteristics, prices and uses in the eyes of the consumers. The Notifying Party considers
    that chilled food should not be included in the same market as frozen food as there are substantial differences in  prices  and  preparation
    methods between both categories of products.

12. Furthermore, the Notifying Party submits, in line with Commission precedents, that branded products and private labels belong  to  the  same
    product markets.[8] This was confirmed during the market investigation.[9]

              1. Ketchup and mustard

13. The Notifying Party concurs with the Commission's decisional practice according to which ketchup and mustard constitute two product  markets
    that are distinct from other types of cold sauces.[10]

14. In any event, for the purposes of the assessment of the notified operation, the exact  delineation  of  the  relevant  product  markets  for
    ketchup and mustard can be left open since the notified operation does not raise serious doubts as to its compatibility  with  the  internal
    market even under the narrowest approach.

              2. Frozen cakes

15. The Notifying Party submits that, on the basis of Commission precedents, the market for cakes should be segmented between  (i)  cakes,  mini
    cakes and other pastries and (ii) morning goods, which include bagels, croissants, scones and similar products that are normally  eaten  for
    breakfast.[11] The Notifying Party adds that a further distinction should be made between frozen and non-frozen desserts. As a  consequence,
    the Notifying Party considers that there is a distinct market for frozen pastries that encompasses cakes, mini cakes and other pastries.

16. The Notifying Party also suggests that it may be relevant to segment this market further in order to distinguish between  frozen  cakes  and
    frozen fruit and berry pies. The distinction between finished and semi-finished products is also considered to be relevant.

17. The market investigation was inconclusive as regards the product market definition for frozen cakes. Whereas half  of  the  competitors  and
    customers who responded to the Commission's requests for information consider that customers regard  frozen  cakes  as  a  distinct  product
    fulfilling a specific need, the other half considers that there are realistic alternatives to frozen cakes such as fresh cakes or ice  cream
    that would be indicative of a broader product market definition than purely  frozen  cakes.[12]  At  the  same  time,  however,  the  market
    investigation revealed that the various suppliers and retailers categorise frozen cakes separately in their internal business reporting.[13]

18. In any event, for the purposes of the assessment of the notified operation, the exact delineation of the relevant product market for  frozen
    cakes can be left open since the notified operation does not raise serious doubts as to its compatibility with the internal market under any
    possible approach.

   3. Soups

19. The Notifying Party submits that soups are a distinct product market  and  should  be  segmented,  pursuant  to  the  Commission's  previous
    decisions, between ambient wet soups, regular dry soups and instant dry soups.[14] The Notifying Party considers that a further  distinction
    can be made by reference to the size of the products (i.e. products that serve one or two persons or larger portions). It also suggests that
    a further segmentation based on the soup's ethnicity could be relevant (for example Asian soups).

20. The Commission, in its previous decisions,[15] considered ambient wet soups to include soups sold in cans, glass jars and aseptic  packaging
    and which are intended for consumption as part of a traditional family meal. This category does not include chilled or  frozen  soups  which
    are generally sold under different brands and require different logistics as they need refrigeration both in the distribution chain  and  in
    the home.

21. In reply to the Commission's requests for information, all the competitors  and  one  out  of  two  customers  considered  that  there  were
    alternatives to ambient wet soup such as chilled or frozen soup.[16] One competitor and one customer mentioned that ambient wet  soup  could
    also be seen as competing with other types of ready meals.[17]

22. In any event, for the purposes of the assessment of the notified operation, the exact delineation of the relevant product market  for  soups
    can be left open since the notified operation does not raise serious doubts as to its compatibility  with  the  internal  market  under  any
    possible approach.

   2. Food service sector

   1. General

23. As in the retail sector, the Notifying Party concurs with the Commission's approach in previous cases according to  which  relevant  product
    markets are delineated by reference to demand-side characteristics. In addition, the Notifying Party submits that, as is the  case  for  the
    retail sector, differences in conservation methods and storage temperature indicate different markets.

24. However, the Notifying Party disagrees with the approach according to which the food service markets  could  be  defined  by  distinguishing
    different customer segments.

25. First, contrary to the Commission's previous practice,[18] the Notifying Party considers that there  should  be  no  distinction  between  a
    commercial segment (restaurants, snack-bars, hotels, fast-food chains, leisure sector  etc.)  and  a  social  segment  (public  institutions
    factory and office canteens, hospitals, schools etc.).

26. Second, the Notifying Party disagrees with a possible distinction between front-of-house products and back-of-house products.[19]  Front-of-
    house products are used, for example, in office buildings (e.g. ready-made drinks sold out of a coffee-machine) or canteens (such  as  salt,
    pepper and salad oils, which are typically offered on the tables of a canteen). Back-of-house products are typically used in the kitchen and
    not visible to the consumer. The Notifying Party considers that such a distinction could only be made within the cold sauce  market  between
    large containers, which are used back-of-house, and smaller containers which are used front-of-house.

27. Third, the Notifying Party indicates that, within the food service sector in the Nordic countries, a segmentation could be made between  the
    two main customer groups, that is to say between "horeca" (hotels, restaurants, catering) and "KGS" (Kiosks and Gas Stations).  However,  as
    such a distinction is not supported by structural or demand-side differences, the Notifying Party submits that it would not  be  appropriate
    to use it to define relevant product markets.

28. From a demand side perspective, most of the respondents to the market investigation indicated that the commercial and social segment do  not
    belong to different markets. The products are perceived as more or less identical, especially in terms of price and  packaging.[20]  From  a
    supply side perspective, the market investigation was not conclusive as to whether a possible distinction between  the  commercial  and  the
    social segment would be relevant.[21]

29. As for the distinction between the front-of-house and back-of-house segments, the majority of respondents to the Commission's  requests  for
    information agree with the Commission's approach in earlier cases and submit that such a distinction is  justified  by  packaging  size  and
    presentation of the product. In addition, brand value is more important in the front-of-house segment, whereas private labels  dominate  the
    back-of-house segment.[22] The market investigation also confirms the possible distinction between the horeca and KGS  segment  for  Denmark
    and Sweden.[23]

30. In any event, the precise market definitions can be left  open  as  the  notified  operation  does  not  raise  serious  doubts  as  to  its
    compatibility with the internal market under any possible approach.

                 2. Ketchup, mustard and other cold sauces (dressing and rémoulade)

31. As in the retail sector, the Notifying Party considers that, in line with previous Commission decisions[24], ketchup and mustard  belong  to
    distinct product markets within the food service sector.

32. In two earlier decisions, the Commission found that cold sauces can be segmented into categories for salad  dressing,  mayonnaise,  mustard,
    ketchup and other cold sauces whereby each represents a separate product market.[25] Dressing is a type of  cold  sauce  mainly  used  as  a
    topping for salads or other food to add taste and juiciness to the meal. Dressing can be based on for example oil, mayonnaise, cream,  crème
    fraiche or yoghurt to which spices or herbs are added for a better taste. The Notifying Party  submits  that  it  could  be  appropriate  to
    distinguish between dressings and other cold sauces.

33. From a supply side perspective, the market investigation was not conclusive as to whether other cold sauces are a category of their  own  or
    belong to a broader category. From a demand side perspective, the majority of respondents suggest that  dressings  are  part  of  a  broader
    category (e.g. garnishes or fast food accompaniments). [26] The market investigation in the present case has indicated,  however,  that  one
    type of cold sauce, namely rémoulade, is particularly appreciated by Danish consumers and as such it could  constitute  a  distinct  product
    market with no realistic alternatives.[27]

34. However, the exact market definitions can be left open as the notified operation does not raise serious doubts as to its compatibility  with
    the internal market under any possible approach.

   3. Wet hot sauces

35. The Notifying Party agrees with the Commission's previous decisional practice,[28] according to which a distinction can be made between  dry
    hot sauces (used as meal ingredients to add flavour to a prepared dish) and wet hot sauces (liquid and  pasta  sauces  for  cooking  or  for
    serving hot).

36. The majority of the respondents to the Commission's requests for information agree with the Commission's previous  practice  to  distinguish
    between dry hot sauces and wet hot sauces.[29] From a demand side perspective, wet hot sauces are seen as part of a broader  category  (e.g.
    dressing or garnishes), while from a supply side perspective wet hot sauces are seen as a category on their  own  by  the  majority  of  the
    respondents to the market investigation.[30]

37. In any event, the precise market definitions can be left  open  as  the  notified  operation  does  not  raise  serious  doubts  as  to  its
    compatibility with the internal market under any possible approach.

   2. Relevant geographic markets

   1. Retail sector

38. The Notifying Party considers that the markets for food products in the retail sector are  national  in  scope,  as  there  are  significant
    differences in sales channels, retailers, logistics, brands, and eating habits between the various EEA countries. This  is  consistent  with
    the Commission's findings in a number of previous decisions.[31]

39. The market investigation in this case did not provide any reasons to deviate from the Commission's previous practice.

   2. Food service sector

40. The Notifying Party submits that, in line with previous Commission decisions,[32] the markets in the food service  sector  are  national  in
    scope.

41. The market investigation in this case did not reveal any reasons to deviate from the Commission's previous position  on  the  scope  of  the
    geographic market.

   3. Competitive assessment

42. The Notifying Party has identified two affected markets in the Danish retail sector (ketchup and mustard) and three affected markets in  the
    Swedish retail sector (ketchup, frozen cake, and soup). As regards the food service sector, the Notifying Party has identified four affected
    markets in Denmark (ketchup, mustard, wet hot sauces, and other cold sauces) and one affected market in Sweden (ketchup).

   1. Retail sector in Denmark

   1. General considerations

43. Orkla is mainly active in the retail sector in Denmark through its subsidiaries Beauvais, which sells ketchup, mustard and  salad  dressings
    under the Beauvais brand, and Kolding Salatfabrik, which sells salad spreads, dinner salads, crispy  fried  onions,  hot  and  cold  sauces,
    mayonnaise, rémoulade, stock jelly, and soup under the Kolding brand.

44. Rieber is mainly active through its Danish subsidiary Rieber & Søn Denmark which sells ketchup, mustard and fast food  dressings  under  the
    Bähncke brand. Rieber also sells salad spreads, dinner salads, mayonnaise, rémoulade, and sauces under the K-Salat brand.

45. On 4 February 2013, the Notifying Party informed the Commission that Orkla had divested its subsidiary Kolding  Salatfabrik  on  1  February
    2013. This removed the overlaps between the Parties' activities in salad spreads, dinner salads, crispy fried onions, mayonnaise,  rémoulade
    and wet hot sauces in the retail sector. As a consequence, these products will not be discussed further in the present decision.

46. The Notifying Party submits that the retail sector in Denmark is very concentrated with three umbrella chains (COOP, Dansk Supermarked,  and
    Supergros) accounting for [90-100]% of all retail sales. According to the Notifying Party, the retail chains exercise  significant  pressure
    on the suppliers during the annual negotiations and private labels are being increasingly marketed and promoted in the same way  as  branded
    products.

47. The buying power of the retails chains has been confirmed during the market investigation as several  of  them  explained  that  they  could
    delist products,[33] even if they were strong brands,[34] and that they are active through numerous private labels.[35]

48. The Notifying Party has identified two affected markets in the Danish retail sector: (i) ketchup and (ii) mustard.[36]

              2. Ketchup

49. In the market for ketchup in Denmark, the Parties' combined market share is [40-50]%[37]  with  Orkla's  market  share  being  [30-40]%  and
    Rieber's being [5-10]%. Other market players include Heinz ([30-40]%), Graasten ([0-5]%), and private labels ([10-20]%).[38]

50. The Notifying Party submits that the competition between ketchups on the branded segment primarily  takes  place  between  Heinz  and  Orkla
    (Beauvais), which have strong customer loyalty. According to the Notifying Party, Rieber's strongest  brand  (Bähncke)[39]  is  not  Orkla's
    closest competitor as it is more fast food oriented and is always promoted with other products from the Bähncke range.

51. The customers who replied to the Commission's requests for information confirmed that Heinz and Orkla (Beauvais) are the closest competitors
    in the Danish retail sector.[40] The responses of the Parties' competitors were inconclusive but one confirmed  that  Orkla  (Beauvais)  and
    Heinz were the closest competitors and another explained that Orkla is strong in retail whereas Rieber is mostly active in fast food.[41]

52. In addition, some customers mentioned that several new branded and private  label  ketchups  have  entered  the  market  in  the  past  five
    years.[42]

53. None of the customers approached by the Commission have raised concerns regarding the impact of  the  proposed  transaction  on  the  Danish
    market for ketchup.[43] Some competitors have expressed concerns which were mostly related to the merged entity's  increased  product  range
    (portfolio effects) which are discussed below at section 4.1.3.1.4.[44]

54. In light in particular of the presence of other strong competitors both in the branded and private label segments, the buyer  power  of  the
    retail chains in Denmark and in the absence of substantiated concerns voiced during the market  investigation,  it  is  concluded  that  the
    proposed transaction does not raise serious doubts as to its compatibility with the internal market with respect to the  retail  market  for
    ketchup in Denmark.

              3. Mustard

55. The Parties' combined market share is [40-50]%, with Orkla accounting for a negligible increase of [0-5]%.

56. The Notifying Party submits that the Parties are under the constraint of Unilever ([10-20]%) and private labels ([20-30]%).[45] In addition,
    the Notifying Party stresses that, while Rieber sells a variety of mustard in plastic bottles and glass jars, Orkla only sells  two  mustard
    varieties in plastic bottles. The Notifying Party also explains that Orkla's market share is shrinking  and  that  is  it  only  permanently
    listed in one retail chain (Dansk Supermarked).

57. A majority of customers consider that Orkla and Rieber are indeed not each other's closest competitors in mustard.[46]

58. In addition, market participants have mentioned that there have been new entries on the market  for  mustard,  both  of  private  label  and
    branded products.[47]

59. None of the customers approached by the Commission have raised concerns regarding the impact of  the  proposed  transaction  on  the  Danish
    market for mustard.[48] Some competitors have expressed concerns which are mainly related to portfolio effects which are  discussed  in  the
    following section.[49]

60. In light in particular of the limited increment in market share, the presence of other strong competitors both in the  branded  and  private
    label segments, the buyer power of the retail chains in Denmark and in the absence  of  substantiated  concerns  voiced  during  the  market
    investigation, it is concluded that the proposed transaction does not raise serious doubts as to its compatibility with the internal  market
    with respect to the retail market for mustard in Denmark.

              4. Portfolio effects

61. One competitor of the Parties noted that they would not only have high market shares in the markets for ketchup and mustard as a  result  of
    the proposed transaction but they would also own must-have brands such as Beauvais (for ketchup) and Bähncke (for mustard). This  competitor
    suggested that this strong position on both products might  lead to a dominance of the merged entity in all  condiments,  primarily  in  the
    retail sector.[50] The competitor expressed the concern that this would enable  the  merged  entity  to  force  retailers  to  accept  price
    increases and to exclude smaller competitors from the markets for condiments.[51] By combining two of the must-have brands  in  ketchup  and
    mustard, the combined entity could thus expand its product portfolio increasing its ability  and  incentive  to  leverage  a  strong  market
    position from one market to another by means of tying or bundling or other exclusionary practices.

62. Contrary to what the competitor explained, the market investigation demonstrated that the merged entity would not have enough  market  power
    to foreclose its rivals, for instance through bundling ketchup and mustard to other condiments, and/or forcing the  retailers  to  accept  a
    price increase.

63. First, responses to the market investigation show that not all the market players consider Beauvais and  Bähncke  as  must-have  brands  for
    ketchup and mayonnaise.[52] A retailer has even explained that it would not hesitate to delist such brands should the merged  entity  submit
    demands that are considered not acceptable during negotiations.[53] In addition, as pointed out by the Parties, the strength of the Parties'
    brands should not be overestimated as Orkla has not managed to use Beauvais' strong position in ketchup to  increase  its  market  share  in
    mustard and, conversely, Bähncke's strength in mustard has not benefitted Rieber in ketchup.

64. Second, responses provided to the Commission's requests for information and in response to other contacts with market players indicate  that
    there are enough alternatives to the merged entity's products on the markets for ketchup and mustard in Denmark: there are branded  products
    (Heinz for ketchup and Unilever for mustard), a number of private labels, new entrants, and one retailer has even mentioned the  possibility
    of sponsoring local suppliers to enter the market.[54] The complainant himself has recognized that the private labels play an important role
    on the market and will act as a "fighting-back stick" for the retailers.[55]

65. Third, it should be pointed out that, even if the negotiations with retailers are conducted for broad categories of products  (e.g.  ambient
    products), there are generally no assortment or portfolio rebates or bonuses. Therefore, if having a wide portfolio may be an  advantage[56]
    and may be used as a threat in negotiations,[57] it will not be enough to restrict the retailers' freedom  to  decide  which  products  they
    sell. In addition, the products at stake do not appear to be easy to bundle as they are not complementary goods.

66. In light of the above, it is concluded that the proposed transaction does not raise serious doubts as to its compatibility with the internal
    market with respect to the possible portfolio effects in the retail sector in Denmark.

   5. Conclusion on retail in Denmark

67. In view of the above, it is concluded that the proposed transaction does not raise serious doubts as to its compatibility with the  internal
    market with respect to the retail sector in Denmark.

   2. Retail sector in Sweden

   1. General considerations

68. Orkla is mainly active in Sweden in the retail sector through its subsidiary Procordia Food AB ("Procordia").[58] According to the  Parties,
    Procordia is one of Sweden's leading food manufacturers and its brands include, among others, Felix and Ekström.

69. Rieber is mainly active in Sweden in the retail sector through its subsidiary Frödinge Mejeri AB ("Frödinge") and markets  its  chilled  and
    frozen cakes under the same brand. Rieber also sells the Mrs Cheng's brand in the Asian food segment.

70. The Notifying Party submits that the concentration of retail chains is very high in Sweden with the four retail chains accounting  for  [90-
    100]% of sales. The strong buyer power has manifested itself through the delisting of the Parties'  products  and  the  launch  of  retailer
    private labels.

71. The Commission identified the following affected markets in Sweden: (i) ketchup, (ii) frozen cakes and (iii) ambient wet soup. [59]

              2. Ketchup

72. In Sweden, Orkla (Procordia) supplies several ketchup products under its Felix brand. Rieber is present under its Danish Bähncke brand.  The
    Notifying Party submits that Bähncke is sold in Sweden through one wholesaler active in the south of the country and these sales result in a
    negligible market share.

73. The Commission notes that although the Parties have a relatively high combined market share ([50-60]%), the  increment  resulting  from  the
    addition of Rieber's market position is negligible ([0-5]%)[60]. As such, the proposed transaction will not bring about a significant change
    in the structure of the ketchup market in Sweden. In addition, the Notifying Party points out that Heinz ([30-40]%) and private labels  ([5-
    10]%) as well as other smaller players ([0-5]%) exercise some significant competitive pressure.  The  market  investigation  confirmed  this
    claim.[61]

74. There have been no substantiated concerns emerging during the market investigation with regard to the proposed transaction  for  the  retail
    market for ketchup in Sweden.

75. In light of the limited increment in market share, the presence of other strong competitors both in the branded and private label  segments,
    the buyer power of the retail chains in Sweden and in the absence of substantiated concerns voiced during the market  investigation,  it  is
    concluded that the proposed transaction does not raise serious doubts as to its compatibility with the internal market with respect  to  the
    retail market for ketchup in Sweden.

              3. Frozen cake

76. Orkla (Procordia), supplies frozen fruit and berry pies under the Ekström brand (semi-finished), while Rieber is present on the market  with
    its Frödinge brand (finished).

77. The Commission notes that although the Parties have a relatively high combined market share ([50-60]%), the  increment  resulting  from  the
    addition of Orkla's market position is very small ([0-5]%). As such, the proposed transaction will not bring about a significant  change  in
    the structure of the frozen cake market in Sweden. In addition, the Notifying Party points out that competitors such as  Almondy  ([30-40]%)
    and private labels ([5-10]%) as well as other smaller players ([5-10]%) exercise some significant competitive pressure.[62]

78. The Notifying Party submits that Orkla has taken the decision to exit the market and will stop selling its products early 2013.[63] This has
    been confirmed by the Notifying Party's internal documents as well as by some market participants.[64]

79. There have been no substantiated concerns emerging during the market investigation with regard to the proposed transaction  for  the  retail
    market for frozen cakes in Sweden.[65]

80. In light of the limited increment in market share, the presence of other strong competitors both in the branded and private label  segments,
    the buyer power of the retail chains in Sweden, Orkla's imminent exit from the market and in the absence of  substantiated  concerns  voiced
    during the market investigation, it is concluded that the proposed transaction does not raise serious doubts as to  its  compatibility  with
    the internal market with respect to the retail market for frozen cakes in Sweden.

              4. Ambient wet soup

81. Orkla (Procordia), supplies canned soup under the Felix brand, whereas Rieber is present on the market with its Mrs. Cheng's brand.

82. The Commission notes that the Parties' combined market share would be [10-20]%, with Orkla accounting for [10-20]% and Rieber for merely [0-
    5]%. Competitors include Arla Foods ([30-40]%), Unilever ([20-30]%), Findus ([10-20]%), and Campbell ([5-10]%).

83. There have been no substantiated concerns emerging during the market investigation with regard to the proposed transaction  for  the  retail
    market for ambient wet soup in Sweden.[66]

84. In light of the moderate combined market share, the limited increment in market share, the presence of other strong competitors both in  the
    branded and private label segments, the buyer power of the retail chains in Sweden and in  the  absence  of  substantiated  concerns  voiced
    during the market investigation, it is concluded that the proposed transaction does not raise serious doubts as to  its  compatibility  with
    the internal market with respect to the retail market for soup in Sweden.

   5. Conclusion on the retail sector in Sweden

85. Although some market participants (in particular competitors) are of the view that the merged entity will be an overall stronger competitor,
    there have been no substantiated claims with regard to the negative impact of  the  proposed  transaction  on  the  retail  market.[67]  The
    Commission also notes that the increment in all retail markets in Sweden is extremely small.

86. In view of the above, it is concluded that the proposed transaction does not raise serious doubts as to its compatibility with the  internal
    market with respect to the retail market in Sweden.

   3. Food service sector in Denmark

   1. General considerations

87. The Notifying Party submits that the affected markets in the Danish food service sector are  the  markets  for  ketchup,  mustard,  wet  hot
    sauces, and other cold sauces.

   2. Ketchup

88. In Denmark, the Parties' combined market share of the overall food service ketchup market amounts to [30-40]% with an increment of only  [0-
    5]% from Orkla.[68] The Parties' main competitors are Heinz ([30-40]%) followed by Scandic Food ([10-20]%) and Graasten ([10-20]%).  Private
    labels account for approximately [5-10]% of the market.

89. The Notifying Party submits that the transaction does not raise competition concerns since there are other strong suppliers  in  the  market
    such as Heinz, ScanFood and Graasten.

90. The market investigation in the present case indicated that Orkla's and Rieber's main competitors in ketchup in Denmark are Heinz,  Graasten
    and the private labels. In addition, the majority of wholesalers in Denmark do not perceive Orkla and Rieber  to  be  each  other's  closest
    competitors in ketchup.[69] Although Rieber's ketchup (Bähncke)  is  perceived  by  majority  of  wholesalers  as  a  "must-have  brand"  in
    Denmark,[70] its strength will not increase post-transaction  as  the  combined  market  shares  will  only  increase  moderately  with  the
    acquisition of Orkla ([0-5]% market share). No substantiated concerns were raised by wholesalers in relation to the market  for  ketchup  in
    Denmark.[71]

91. In view of the foregoing, the proposed transaction does not raise serious doubts as to its  compatibility  with  the  internal  market  with
    respect to the market for ketchup in the food service sector in Denmark.

              3. Mustard

92. Post transaction, the Parties' combined market share of the overall food service market for mustard would amount to approximately  [60-70]%,
    but the increment is less than [0-5]% (from Orkla).[72]

93. The Notifying Party submits that the transaction does not raise competition concerns due to Orkla's de minimis market share and the presence
    of other suppliers such as Unilever with its Maille brand ([10-20]%) and private label manufacturers ([10-20]%).  The  market  investigation
    confirmed the presence of other suppliers, such as Unilever, Graasten and private labels.[73]

94. Given the small market share of Orkla and the fact that no substantiated concerns  were  expressed  during  the  market  investigation,  the
    transaction does not raise serious doubts as to its compatibility with the internal market with respect to the market  for  mustard  in  the
    food service sector in Denmark.

              4. Other cold sauces (dressing and rémoulade)

95. As "other cold sauces" encompasses a variety of different products[74], the Notifying Party submits  it  is  impossible  to  provide  market
    shares estimates to cover all other cold sauces.  Instead,  market  positions  are  provided  for  the  narrower  market  of  dressings  and
    rémoulade.[75]

96. In the overall food service market for dressings only, the combined market share would amount post-transaction to [30-40]% with an increment
    from Orkla of [0-5]%. Scandic Foods ([30-40]%) and private labels ([30-40]%) account for the remainder of the market.[76]

97. In the overall food service market for rémoulade only, the combined market share  would  be  [40-50]%  with  an  increment  of  [0-5]%  from
    Orkla.[77] This overlap, however, will be eliminated by the divestiture of Kolding Salatfabrik.

98. In an overall food service market including both dressing and rémoulade, the Parties' combined market share would amount to  [30-40]%,  with
    an increment of [0-5]% from Orkla.[78] The other suppliers retain [60-70]% of the market.

99. The Notifying Party submits that no competition concerns will arise in the market for other cold sauces since Orkla's position  in  dressing
    and rémoulade is negligible, and the Parties have negligible sales of other cold sauces.[79]

100. There have been no substantiated concerns voiced during the market investigation with regard  to  the  proposed  transaction  for  the  food
    service market for other cold sauces in Denmark. Only one customer expressed concerns by pointing out that, in general, in the food  service
    sector, the proposed transaction will lead to a reduction in the number of suppliers that can offer a complete  range  of  products.[80]  In
    particular, this customer emphasised that the most important suppliers currently on the market are Graasten, Kolding Salatfabrik (Orkla) and
    Rieber. However, as explained in paragraph 45 above, Kolding Salatfrabrik has been divested.

101. Given in particular the limited presence of Orkla in this market and the divestiture of Kolding Salatfabrik, the proposed  transaction  will
    not lead to a change in the market structure and therefore it does not raise serious doubts as to its compatibility with the internal market
    with respect to the market for other cold sauces (dressing and rémoulade) in the food service sector in Denmark.

              5. Wet hot sauce

102. In the overall food service market for wet hot sauce, Orkla's market share is minimal (less than [0-5]%) and the  Parties'  combined  market
    share would amount to [40-50]%.[81] Scandic Foods and Graasten each have a market share of [20-30]% while Danish Crown ([10-20]%)  comes  in
    fourth position. The Notifying Party submits that no competition concerns arise in the market for wet hot sauce due  to  Orkla's  negligible
    and declining market position.

103. The market investigation confirmed the presence of other suppliers in the market for wet hot sauces such as  Jensen's  Køkken,  Arla  Foods,
    Kraft Foods, Knorr and private labels.[82] No concerns have been expressed during the market  investigation  with  regard  to  the  proposed
    transaction for the food service market for wet hot sauces in Denmark.

104. In view of the foregoing, the proposed transaction does not raise serious doubts as to its  compatibility  with  the  internal  market  with
    respect to the market for wet hot sauce in the food service sector in Denmark.

   6. General conclusion

105. In light of all the above, the proposed transaction does not raise serious doubts as to its compatibility  with  the  internal  market  with
    respect to the food service sector in Denmark.

   4. Food service sector in Sweden

106. The only affected market in the food service sector in Sweden is ketchup. The Parties' combined market share for the  overall  food  service
    market for ketchup is [40-50]% with an increment of [0-5]% from Rieber.[83] The Parties' main competitor is Heinz ([40-50]%). Private labels
    account for approximately [5-10]% of the market.

107. The Notifying Party submits that the transaction does not raise competition  concerns  since  the  Parties  are  not  each  other's  closest
    competitors (Orkla's ketchup is a basic/standard product, while Rieber's ketchup is a niche product).

108. The market investigation in the present case indicated that Orkla's main competitor is Heinz.  No  substantiated  concerns  were  raised  by
    wholesalers in relation to the market for ketchup in Sweden.[84]

109. In light of the above, the proposed transaction does not raise serious doubts as to its compatibility with the internal market with  respect
    to the food service sector in Sweden.

   2. Vertical relations

110. The Parties have limited vertical relationships in the production of foods ingredients at industry level in Sweden and Denmark  and  in  the
    retail distribution of frozen cakes in Finland. However, only the vertical links between bakery ingredients/bakery fat (upstream) and frozen
    cakes (downstream) in Sweden, as well as the retail distribution of frozen cakes in Finland lead to affected markets.[85]

   1. Bakery ingredients and bakery fat in Sweden

111. Orkla produces food ingredients through its subsidiary Orkla Food Ingredients (“OFI”). It is mostly active in bread  and  cake/pastry  mixes
    and improvers, yeast, margarine products, marzipan and ice cream ingredients.[86]

112. As regards bakery ingredients and bakery fats, the Notifying Party estimates that, under any plausible market definition, the market  shares
    of Orkla would be below [20-30]% and, in most cases, below [10-20]% in the upstream market.[87] Therefore, in the absence of market power in
    the upstream market, input foreclosure is unlikely.[88] Bakery ingredients and bakery fat are  used  in  a  number  of  downstream  markets,
    although by Rieber in Sweden only in the production of frozen cakes. In addition, Rieber's purchases are  limited.[89]  Therefore,  customer
    foreclosure concerns can be also excluded.

113. As a consequence, the proposed transaction will not give rise to foreclosure concerns or serious doubts in relation to the supply of  bakery
    ingredients and bakery fat in Sweden.[90]

   2. Distribution of frozen cakes in Finland

114. Orkla’s Finnish subsidiary, Chips AB, distributes frozen cakes to retail customers in Finland for Rieber’s Swedish subsidiary Frödinge.

115. As regard the market definition, the Notifying Party submits that the market definition for frozen cakes in Sweden, which concurs  with  the
    Commission's approach in previous cases[91], should also apply to Finland.[92]

116. According to the Notifying Party, Rieber has a [20-30]% market share in the manufacture and sale of frozen cakes in Finland,  whereas  Orkla
    has a [0-5]% share in the wholesale distribution of frozen food products in Finland.[93]

117. Post transaction, the merged entity will face a number of strong competitors on the upstream market such as Heinz,  Almondy,  and  Sarp  Oy,
    and at the wholesale level with the three largest Finnish wholesale groups (i.e. S-Group, K-Group, and Suomen Lähikauppa OY).[94]

118. Therefore, in the light in particular of the moderate market shares of the  merged  entity  both  at  upstream  and  downstream  level,  the
    proposed transaction will not give rise to any risk of foreclosure issues and the combined entity  is  unlikely  to  have  the  ability  and
    incentive to foreclose customers and/or downstream competitors.

   5. CONCLUSION

119. For the above reasons, the European Commission has decided not to oppose the notified operation  and  to  declare  it  compatible  with  the
    internal market and with the EEA Agreement. This decision is adopted in application of Article 6(1)(b) of the Merger Regulation.

                                        For the Commission
                                        (signed)

                                        Neelie KROES
                                        Vice-President

-----------------------
[1]   OJ L 24, 29.1.2004, p. 1 ("the Merger Regulation"). With effect from 1 December 2009, the Treaty on the Functioning of the  European  Union
      ("TFEU") has introduced certain changes, such as the replacement of "Community" by "Union" and "common market" by  "internal  market".  The
      terminology of the TFEU will be used throughout this decision.

[2]   Publication in the Official Journal of the European Union No C 31, 2.2.2013, p. 14.

[3]   Orkla has agreed with Norsk Hydro ASA to place Sapa in a joint venture. Sapa will be a 50/50 joint venture owned by Orkla and  Norsk  Hydro
      ASA. Completion of the transaction is expected to take place in the first half of  2013,  following  approvals  from  relevant  competition
      authorities (Source: Form CO).

[4]   The food service sector comprises the supply to out-of-home eating (e.g. hotels, restaurants, fast-foods  and  pizzeria  outlets,  sandwich
      shops) and institutional catering (factory and office canteens, hospitals, schools etc.)

[5]   The proposed transaction does not meet the turnover thresholds of Article 1(2) of the Merger Regulation as only  one  of  the  undertakings
      concerned had a Community-wide turnover of more than EUR 250 million. The proposed transaction fulfils the alternative turnover  thresholds
      of Article 1(3) of the Merger Regulation as the combined aggregate worldwide turnover of all the undertakings concerned is more than EUR  2
      500 million [Orkla: EUR […] million, Rieber: EUR […] million], in each of at least three Member States the combined aggregate  turnover  of
      all the undertakings concerned is more than EUR 100 million and in each of at least three of those Member States the aggregate turnover  of
      at least two of the undertakings concerned is more than EUR 25 million [In Denmark – Orkla: EUR […] million, Rieber: EUR  […]  million;  in
      Poland – Orkla: EUR […] million, Rieber: EUR […] million; in Sweden – Orkla: EUR […] million, Rieber: EUR […] million].  In  addition,  the
      aggregate Community-wide turnover of at least two of the undertakings concerned is more than EUR  100  million  [Orkla:  EUR  […]  million,
      Rieber: EUR […] million] and none of the undertakings concerned achieves more than two-thirds  of  its  aggregate  Community-wide  turnover
      within one and the same Member State.

[6]   A vertical link in Finland is also assessed in the present decision.

[7]   Cases COMP/M.1990 - Unilever/Bestfoods, COMP/M.2302 - Heinz/CSM, COMP/M.3658 - Orkla/Chips.

[8]   Case COMP/M.6321 – Buitenfood/Ad Van Geloven Holding/JV.

[9]   See replies to questions 5 and 8 of the Commission’s request for information pursuant to Article 11 of Council Regulation (EC) No  139/2004
      addressed to competitors – Retail Sweden (Q8), dated 30 January 2013. See replies to questions 9 and 12 of  the  Commission’s  request  for
      information pursuant to Article 11 of Council Regulation (EC) No 139/2004 addressed to customers – Retail Sweden  (Q3),  dated  30  January
      2013. See replies to questions 9, 12 and 15 of the Commission’s request for information pursuant to Article 11 of Council  Regulation  (EC)
      No 139/2004 addressed to customers – Retail Denmark (Q1), dated 30 January 2013. See replies to questions 5, 8 and 11 of  the  Commission’s
      request for information pursuant to Article 11 of Council Regulation (EC) No 139/2004 addressed to competitors – Retail Denmark (Q7), dated
      30 January 2013.

[10]  Cases COMP/M.1802 – Unilever/Amora Maille, COMP/M.1990 – Unilever/Bestfoods.

[11]  Cases COMP/M.2817 – Barilla/BPL/Kamps, COMP/M.5286 – Lion Capital/Foodvest, COMP/M.6143 – Princes/Premier Foods Cannes Grocery Operations.

[12]  See reply to question 4 of the Commission’s request for information  pursuant  to  Article  11  of  Council  Regulation  (EC)  No  139/2004
      addressed to competitors – Retail Sweden (Q8), dated 30 January 2013. See reply to question 8 of the Commission’s request  for  information
      pursuant to Article 11 of Council Regulation (EC) No 139/2004 addressed to customers – Retail Sweden (Q3), dated 30 January 2013.

[13]  See reply to question 3 of the Commission’s request for information  pursuant  to  Article  11  of  Council  Regulation  (EC)  No  139/2004
      addressed to competitors – Retail Sweden (Q8), dated 30 January 2013. See reply to question 7 of the Commission’s request  for  information
      pursuant to Article 11 of Council Regulation (EC) No 139/2004 addressed to customers – Retail Sweden (Q3), dated 30 January 2013.

[14]  Case COMP/M.1990 - Unilever/Bestfoods.

[15]  Idem.

[16]  See reply to question 7 of the Commission’s request for information  pursuant  to  Article  11  of  Council  Regulation  (EC)  No  139/2004
      addressed to competitors – Retail Sweden (Q8), dated 30 January 2013. See reply to question 11 of the Commission’s request for  information
      pursuant to Article 11 of Council Regulation (EC) No 139/2004 addressed to customers – Retail Sweden (Q3), dated 30 January 2013.

[17]  See reply to question 7 of the Commission’s request for information  pursuant  to  Article  11  of  Council  Regulation  (EC)  No  139/2004
      addressed to competitors – Retail Sweden (Q8), dated 30 January 2013. See reply to question 11 of the Commission’s request for  information
      pursuant to Article 11 of Council Regulation (EC) No 139/2004 addressed to customers – Retail Sweden (Q3), dated 30 January 2013.

[18]  Cases COMP/M.1990 - Unilever/Bestfoods, COMP/M.4216 - CVC/Bocchi/De Weide Blik, COMP/M.5199 - De Weide Blik/Atlanta.

[19]  Case COMP/M.1990 - Unilever/Bestfoods.

[20]  See reply to question 4 of the Commission’s request for information  pursuant  to  Article  11  of  Council  Regulation  (EC)  No  139/2004
      addressed to customers - Food Service - Denmark (Q2), dated 30 January 2013.

[21]        See reply to question 3 of the Commission’s request for information pursuant to Article 11 of Council  Regulation  (EC)  No  139/2004
      addressed to competitors - Food Service - Denmark (Q5), dated 30 January 2013.

[22]  See reply to questions 6 and 7 of the Commission’s request for information pursuant to Article 11 of Council Regulation  (EC)  No  139/2004
      addressed to customers and competitors - Food Service - Denmark (Q2 and Q5), dated 30 January 2013.

[23]  See reply to questions 4 and 5 of the Commission’s request for information pursuant to Article 11 of Council Regulation  (EC)  No  139/2004
      addressed to customers and competitors - Food Service - Denmark (Q2 and Q5), dated 30 January 2013.

[24]  Cases COMP/M.1990 - Unilever/Bestfoods, COMP/M.1802 - Unilever/Amora-Maille.

[25]  Cases COMP/M.1990 - Unilever/Bestfoods, COMP/M.1802 - Unilever/Amora-Maille.

[26]  See reply to question 15 of the Commission’s request for information pursuant  to  Article  11  of  Council  Regulation  (EC)  No  139/2004
      addressed to customers - Food Service-Denmark (Q2), dated 30 January 2013.

[27]  See reply to questions 16 and 15 of the Commission’s request for information pursuant to Article 11 of Council Regulation (EC) No  139/2004
      addressed to customers and competitors - Food Service - Denmark (Q2 and Q5), dated 30 January 2013. See also minutes of the conference call
      with one wholesaler of 13 February 2013.

[28]        Cases COMP/M.1802 - Unilever/Amora-Maille, COMP/M.1990 - Unilever/Bestfoods.

[29]  See reply to questions 12 and 11 of the Commission’s request for information pursuant to Article 11 of Council Regulation (EC) No  139/2004
      addressed to customers and competitors - Food Service - Denmark (Q2 and Q5), dated 30 January 2013.

[30]  See reply to questions 11 and 10 of the Commission’s request for information pursuant to Article 11 of Council Regulation (EC) No  139/2004
      addressed to customers and competitors - Food Service - Denmark (Q2 and Q5), dated 30 January 2013.

[31]  Cases COMP/M.5975 – Lion Capital/Picard Group, COMP/M.3658 - Orkla/Chips.

[32]  Case COMP/M.1990 - Unilever/Bestfoods.

[33]  See for example replies to questions 24 and 25 of the Commission’s request for information pursuant to Article  11  of  Council  Regulation
      (EC) No 139/2004 addressed to customers – Retail Denmark (Q1), dated 30 January  2013.  See  for  example  reply  to  question  14  of  the
      Commission’s request for information pursuant to Article 11 of Council Regulation (EC)  No  139/2004  addressed  to  competitors  –  Retail
      Denmark (Q7), dated 30 January 2013.

[34]  See minutes of the conference call with one retailer of 13 February 2013.

[35]  See for example replies to questions 32 and 40 of the Commission’s request for information pursuant to Article  11  of  Council  Regulation
      (EC) No 139/2004 addressed to customers – Retail Denmark (Q1), dated 30 January 2013.

[36]  Orkla and Rieber each sell dressings but Orkla is active in salad dressings (which constitute a separate product market  according  to  the
      Commission's previous decisions in Cases COMP/M.1802 - Unilever/Amora-Maille, and COMP/M.1990 - Unilever/Bestfoods)  whereas  Rieber  sells
      dressings used on sandwiches, potatoes or fish products. As there are no overlaps, these products are therefore not  discussed  further  in
      the present decision.

[37]  The latest available market shares as provided by the Parties are used in the present decision. This implies for  some  markets  full  year
      2012, for others 2012 year-to-date and for some the last twelve months.

[38]  Rieber produces private labels which represent [10-20]% of the total sales of private label ketchup in Denmark. This corresponds to  [0-5]%
      of the overall market which is not included in Rieber's market share.

[39]  Bähncke represents a [5-10]% market share.

[40]  See reply to question 28 of the Commission’s request for information pursuant  to  Article  11  of  Council  Regulation  (EC)  No  139/2004
      addressed to customers – Retail Denmark (Q1), dated 30 January 2013. See reply to question 22 of the Commission’s request  for  information
      pursuant to Article 11 of Council Regulation (EC) No 139/2004 addressed to competitors – Retail Denmark (Q7), dated 30 January 2013.

[41]  See reply to question 22 of the Commission’s request for information pursuant  to  Article  11  of  Council  Regulation  (EC)  No  139/2004
      addressed to competitors – Retail Denmark (Q7), dated 30 January 2013.

[42]  See reply to question 33 of the Commission’s request for information pursuant  to  Article  11  of  Council  Regulation  (EC)  No  139/2004
      addressed to competitors – Retail Denmark (Q7), dated 30 January 2013.

[43]  See reply to question 69.1 of the Commission’s request for information pursuant to Article  11  of  Council  Regulation  (EC)  No  139/2004
      addressed to customers – Retail Denmark (Q1), dated 30 January 2013.

[44]  See reply to question 54.1 of the Commission’s request for information pursuant to Article  11  of  Council  Regulation  (EC)  No  139/2004
      addressed to competitors – Retail Denmark (Q7), dated 30 January 2013.

[45]  Rieber produces private labels which represent [5-10]% of the total sales of private labels in Denmark.

[46]  See reply to question 36 of the Commission’s request for information pursuant  to  Article  11  of  Council  Regulation  (EC)  No  139/2004
      addressed to customers – Retail Denmark (Q1), dated 30 January 2013. See reply to question 28 of the Commission’s request  for  information
      pursuant to Article 11 of Council Regulation (EC) No 139/2004 addressed to competitors – Retail Denmark (Q7), dated 30  January  2013.  The
      replies of competitors were inconclusive.

[47]  See reply to question 41 of the Commission’s request for information pursuant  to  Article  11  of  Council  Regulation  (EC)  No  139/2004
      addressed to customers – Retail Denmark (Q1), dated 30 January 2013. See reply to question 32 of the Commission’s request  for  information
      pursuant to Article 11 of Council Regulation (EC) No 139/2004 addressed to competitors – Retail Denmark (Q7), dated 30  January  2013.  The
      replies of competitors were inconclusive.

[48]  See reply to question 69.1.2 of the Commission’s request for information pursuant to Article 11 of  Council  Regulation  (EC)  No  139/2004
      addressed to competitors – Retail Denmark (Q7), dated 30 January 2013.

[49]  See reply to question 54.1 of the Commission’s request for information pursuant to Article  11  of  Council  Regulation  (EC)  No  139/2004
      addressed to competitors – Retail Denmark (Q7), dated 30 January 2013.

[50]  See minutes of the conference call with a competitor of 6 and 7 February 2013. The competitor considers that the proposed  transaction  may
      also have an impact on the food service sector but considers that it will not be important as the players in the food service  sector  have
      more freedom to switch from one product to another and can therefore fight a price increase. This is confirmed by  another  competitor  who
      explained that brands are less important in the food service sector, see minutes of the conference call with […] of 14 February 2013. Since
      there are no substantiated concerns raised by competitors or customers in the food service sector, this allegation is not discussed further
      in the present decision.

[51]  Other competitors have mentioned the strong brands and the product range of the parties without, however,  showing  substantiated  concerns
      about the impact of the transaction. Commission’s request for information pursuant to Article 11 of Council  Regulation  (EC)  No  139/2004
      addressed to competitors – Retail Denmark.

[52]  See replies to questions 31 and 39 of the Commission’s request for information pursuant  to  Article  11  of  Council  Regulation  (EC)  No
      139/2004 addressed to customers – Retail Denmark (Q1), dated 30 January 2013. See replies to  questions  25  and  31  of  the  Commission’s
      request for information pursuant to Article 11 of Council Regulation (EC) No 139/2004 addressed to competitors – Retail Denmark (Q7), dated
      30 January 2013.

[53]  See minutes of the conference call with a retailer of 13 February 2013.

[54]  See minutes of the conference call with a retailer of 13 February 2013.

[55]  See minutes of the conference call with a competitor of 6 and 7 February 2013.

[56]  See minutes of the conference call with a competitor of 14 February 2013.

[57]  See minutes of the conference call with a retailer of 13 February 2013.

[58]  Abba Seafood AB is also an Orkla subsidiary. It manufactures and markets preserved fish and shellfish products.

[59]  The Notifying Party also identified overlaps in the following product categories: cold sauces,  potato  products,  canned  vegetables,  and
      chilled desserts. However, these overlaps do not lead to affected markets and are therefore not discussed further in this decision.

[60]        See for example a competitor's reply Commission’s request for information pursuant to  Article  11  of  Council  Regulation  (EC)  No
      139/2004 addressed to competitors – Retail Sweden: "only small increment in the ketchup sector in Sweden".

[61]  "Procordia's brand Felix is a market leader, it strongly competes with Heinz in Sweden. In addition, this market is characterised by a  lot
      of private labels." See minutes of the conference call with a retailer dated 21 January 2013.

[62]  "Rieber's Frödinge brand is strong but […] it competes with another major player named Almondy in the Swedish market […] each of those  two
      players holds a share of approximately […] in that segment." Minutes with […] 21/01/2013

[63]  The last production date of Ekström frozen cake products was in February 2013.

[64]  "Procordia shut down its business in this segment a few months ago." See minutes of the conference call with a retailer  dated  21  January
      2013.

[65]  "[Retailer] does not think that the proposed Transaction will create a competition problem" See minutes  of  the  conference  call  with  a
      retailer dated 21 January 2013.

[66]  "Given that Rieber is not currently active in the retail soups market in Sweden, […] does not believe that the  proposed  transaction  will
      have an impact in the sector." A competitor's reply to the  Commission’s  request  for  information  pursuant  to  Article  11  of  Council
      Regulation (EC) No 139/2004 addressed to competitors – Retail Sweden.

[67]  "Orkla is today already a major player in the Swedish food retail sector but Rieber’s market presence is limited; we  therefore  anticipate
      only a limited impact on the retail food sector as a whole." A competitor's reply to the Commission’s request for information  pursuant  to
      Article 11 of Council Regulation (EC) No 139/2004 addressed to competitors – Retail Sweden.

[68]  With regard to a possible further segmentation of the overall food service ketchup market in Denmark, the  front-of-house  segment  is  not
      affected (Orkla [0-5]%, Rieber [5-10]%), whilst in the back-of-house-segment there is  no  overlap,  as  only  Rieber  is  active.  In  the
      commercial and social segments, the Parties' combined market share amounts to [30-40]% and [30-40]% respectively, with  limited  increments
      from Orkla in each case of [0-5]% and [0-5]%. The Parties' combined market share in the horeca and KGS segments amounts to [30-40]% and [40-
      50]% respectively though with a negligible increment of only [0-5]% from Orkla in each segment.

[69]  See reply to question 32 of the Commission’s request for information pursuant  to  Article  11  of  Council  Regulation  (EC)  No  139/2004
      addressed to customers - Food Service - Denmark (Q2)

[70]  See reply to question 35 of the Commission’s request for information pursuant  to  Article  11  of  Council  Regulation  (EC)  No  139/2004
      addressed to customers - Food Service - Denmark (Q2), dated 30 January 2013.

[71]  See reply to question 29 of the Commission’s request for information pursuant  to  Article  11  of  Council  Regulation  (EC)  No  139/2004
      addressed to customers - Food Service-Sweden (Q4) and reply to question 47.1  of  the  Commission  request  for  information  addressed  to
      customers customers - Food Service - Denmark (Q2)

[72]  With regard to a possible further segmentation of the overall food service mustard market in Denmark, the  front-of-house  segment  is  not
      affected (Orkla [0-5]%, Rieber [10-20]%), whilst in the back-of-house-segment there is no  overlap,  as  only  Rieber  is  active.  In  the
      commercial and social segments, the Parties' combined market share amounts  to  [60-70]%  and  [30-40]%  respectively,  with  a  negligible
      increment from Orkla of only [0-5]% in the commercial segment and no overlap whatsoever in the social segment. The Parties' combined market
      share in the horeca and KGS segments amounts to [50-60]% and [80-90]% respectively, with a negligible increment from Orkla of  only  [0-5]%
      in the horeca segment and no overlap whatsoever in the KGS segment.

[73]  See reply to question 38 of the Commission’s request for information pursuant  to  Article  11  of  Council  Regulation  (EC)  No  139/2004
      addressed to customers- Food Service-Denmark (Q2), dated 30 January 2013.

[74]  In M.1990-Unilever/Bestfoods, the Commission identified other cold sauces to comprise  mayonnaise  based  sauces  (“béarnaise”,  “tartare”,
      “cocktail”) and “exotic” or “ethnic” sauces with a non-mayonnaise base (tabasco, salsa, guacamole).

[75]  The overlap in the Danish food service market in cold sauces only concerns dressing and rémoulade as Orkla is only  active  in  these  cold
      sauces with dressing and rémoulade. Rieber also markets BBQ sauce.

[76]  With regard to a possible further segmentation of the overall food service market for dressing only,  the  front-of-house  segment  is  not
      affected (Orkla [5-10]%, Rieber [5-10]%), whilst in the back-of-house-segment the Parties' combined market share for dressing would  amount
      to [40-50]% (with a negligible increment of only [0-5]% from Orkla). In the commercial and social segments, the  Parties'  combined  market
      share amounts to [30-40]% and [20-30]% respectively, with a limited increment from Orkla of only [0-5]% in the commercial segment  and  [0-
      5]% in the social segment. The Parties' combined market share in the horeca and KGS segments amounts to [30-40]% and [30-40]% respectively,
      with a limited increment from Orkla of only [0-5]% in the horeca segment and no overlap whatsoever in the KGS segment.

[77]  With regard to a possible further segmentation of the overall food service market for rémoulade only, the  front-of-house  segment  is  not
      affected (Orkla [0-5]%, Rieber [10-20]%), whilst in the back-of-house-segment there is  no  overlap  as  only  Rieber  is  active.  In  the
      commercial and social segments, the Parties' combined market share amounts to [50-60]% and [80-90]% respectively, with a limited  increment
      from Orkla of only [0-5]% in the commercial segment and no overlap whatsoever in the social segment. The Parties' combined market share  in
      the horeca and KGS segments amounts to [60-70]% and [50-60]% respectively, with a limited increment from Orkla of only [0-5]% in the horeca
      segment and no overlap whatsoever in the KGS segment.

[78]  With regard to a possible further segmentation of the overall food service market for dressing and rémoulade together,  the  front-of-house
      segment is not affected (Orkla [0-5]%, Rieber [5-10]%), whilst in the back-of-house-segment the Parties' combined market share  amounts  to
      [50-60]%, with a limited increment from Orkla of only [0-5]%. In the commercial and social segments, the  Parties'  combined  market  share
      amounts to [40-50]% and [70-80]% respectively, with a limited increment from Orkla of only [0-5]% in the commercial segment and only [0-5]%
      in the social segment. The Parties' combined market share in the horeca and KGS segments amounts to  [50-60]%  and  [50-60]%  respectively,
      with a limited increment from Orkla of only [0-5]% in the horeca segment and no overlap whatsoever in the KGS segment.

[79]  Rieber's sales of barbecue sauces in 2011 were approximately EUR […] million while Orkla's sales of "English sauce" were EUR […] million.

[80]  See reply to question 45 to 47 of the Commission’s request for information pursuant to Article 11 of Council Regulation  (EC)  No  139/2004
      addressed to customers-Food Service-Denmark (Q2), dated 30 January 2013. See also minutes with customer (Food Service sector Demark) of  18
      February 2013.

[81]  With regard to a possible further segmentation of the overall food service market for wet hot sauces, no overlaps would  arise  in  any  of
      the subsegments.

[82]  See reply to questions 33 and 34 of the Commission’s request for information pursuant to Article 11 of Council Regulation (EC) No  139/2004
      addressed to customers and replies to questions 29 and 33 addressed to competitors - Food Service-Denmark (Q2 and  Q5),  dated  30  January
      2013.

[83]  If other sub-segmentations of the food service market for ketchup would be taken into account, the Parties'  combined  market  share  would
      amount to [50-60]% in the front-of-house segment, [10-20]% in the commercial segment and [40-50]%  in  the  horeca  segment,  with  limited
      increments from Orkla (below [0-5]%). No overlaps would arise in the market for ketchup in the back-of-house segment,  social  segment  and
      KGS segments.

[84]  See reply to question 29 of the Commission’s request for information pursuant  to  Article  11  of  Council  Regulation  (EC)  No  139/2004
      addressed to customers - Food Service-Sweden (Q4) and reply to question 47.1  of  the  Commission  request  for  information  addressed  to
      customers customers-Food Service-Denmark (Q2)

[85]  There are some further actual and potential vertical relations between  the  Parties  concerning  emulsion  bases  produced  by  the  Orkla
      subsidiary, Odense Marcipan A/S used by Rieber's K-salat and a specific type of savoury bread topping, stock jelly, produced  by  Orkla  in
      Denmark through its subsidiary KT Food and sold to Bähncke (Rieber buys the product from KT Food packaged and already branded as a  Bähncke
      product).

[86]  Rieber is active in the industry sector through  its  subsidiary  Rieber  Food  Ingredients  (“RFI”),  which  sells  beef  extract  powder,
      hydrolysed vegetable proteins (powder, paste and liquid), thermal process flavours (powder  for  use  in  meat  related  food  production),
      industrial bouillons (powder), spice mixes (powder), precooked pulses (both whole  and  powder)  and  specialties  like  green  peas,  meat
      derivatives, sauces, vegetable extracts etc. Rieber has divested in 2011 its division which supplied Orkla with  blended  spice  mixes  and
      flavour blends. As Rieber does not intend to re-enter this segment and does not produce any ingredients that are of use for Orkla, Rieber's
      activity in the industry sector are not further discussed in the present decision.

[87]  For bakery products, Orkla estimates its market share at European level to amount to [5-10]%; for bakery fat,  Orkla  estimates  that,  its
      market share at European level would account for less than [10-20]% and less than [20-30]% on a narrower market (i.e. Sweden).

[88]  Paragraph 35 of the "Guidelines on the assessment of non-horizontal mergers under the Council Regulation on the control  of  concentrations
      between undertakings", OJ C 265 of 18.10.2008 ("Non-horizontal Guidelines").

[89]  Rieber’s purchase of bakery products amounted to EUR […] Million in 2011. For  bakery  fat,  Rieber  is  currently  purchasing  from  three
      different suppliers and its purchases from Orkla are estimated at EUR […] Million.

[90]  Paragraph 66 of the Non-horizontal Guidelines.

[91]        Cases COMP/M.2817 – Barilla/BPL/Kamps, COMP/M.5286 – Lion  Capital/Foodvest,  COMP/M.6143  –  Princes/Premier  Foods  Cannes  Grocery
      Operations.

[92]  Case No COMP/M.6430 - Oaktree/Panrico. See also Cases COMP/M.2817 – Barilla/BPL/Kamps and COMP/M.5286 - Lion Capital/Foodvest.

[93]  Market shares based on the Parties' best estimates.

[94]  According to the Notifying Party, almost one-third of  the  total  wholesale  trade  in  Finland  is  transacted  through  these  wholesale
      organizations.

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 In the published version of this decision, some information has been omitted pursuant to Article 17(2) of Council Regulation (EC)  No  139/2004
 concerning non-disclosure of business secrets and other confidential information.  The  omissions  are  shown  thus  […].  Where  possible  the
 information omitted has been replaced by ranges of figures or a general description.

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