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Europe approves acquisition of WhiteWave by Danone, subject to conditions

Staff Writer | December 16, 2016
The European Commission has cleared under the EU Merger Regulation the proposed acquisition of WhiteWave by Danone group.
Acquisition   Danone is active in the European Economic Area
The clearance is conditional upon the divestment of Danone's "growing-up milk" business in Belgium.

Danone is active in the European Economic Area (EEA) mainly in dairy products but also in early life nutrition products.

WhiteWave manufactures plant-based products such as soy milk and yoghurts under its Alpro and Provamel brands. Alpro products also include plant-based "growing-up milk" (for children aged 1 to 3 years).

The Commission had concerns that the proposed transaction would have significantly reduced competition for "growing-up milk" in Belgium. The commitments offered by Danone address these concerns.

The Commission examined the effects of the proposed transaction in the markets for "growing up milk", yoghurts and desserts.

The Commission's investigation indicated that the proposed transaction would leave only one other competitor, Nestlé, on the market for "growing-up milk" in Belgium.

The Commission had concerns that the merged entity would not have faced sufficient competitive pressure from the remaining player in this market.

Furthermore, there would be no other competitor in the plant-based "growing-up milk" segment in Belgium, where only Danone and Alpro are active. This would have left Belgian consumers with no alternative to the merged entity in this market.

The Commission found no competition concerns with respect to other products concerned by the transaction, such as yoghurts and desserts.

The transaction is mostly complementary since Danone, with minor exceptions, is active mainly in dairy products, whereas Alpro is specialised in the plant-based segment.

To address the Commission's competition concerns, Danone offered to divest a large part of its "growing-up milk" business in Belgium.

The divestment entirely removes the overlap between the companies in Belgium on the overall "growing-up milk" market, comprising both dairy and plant-based products, as well as on the sub-market only for plant-based products.

Therefore, the Commission concluded that the transaction, as modified by the commitments, would no longer raise competition concerns. The Commission's approval is conditional upon full compliance with the commitments.