Südzucker-SLS deal is on hold

On August 23, the European Commission said it had opened an in-depth, four-month probe into plans by the German sugar producer Südzucker AG to buy French sugar maker Saint Louis Sucre S.A (SLS), Reuters reports. Last June, Germany's Südzucker announced it had agreed to buy France's second-biggest sugar producer for Euro1.6bn including debt. "The merger will affect all segments of the sugar market,"​ the Commission, the European Union's competition watchdog, said in a statement after its initial one-month review of the deal. "Initial investigations have revealed that there are serious concerns regarding the sugar market as a whole in southern Germany and Belgium, where, before the merger, Südzucker already enjoys a dominant position, with a market share of 70-90 per cent,"​ it said. The Commission will investigate whether the loss of Saint Louis Sucre as an existing or potential competitor to Südzucker would increase the group's dominance in these markets. The investigation would also take into account the special competitive conditions that are mostly regulated by the EU's common market organisation for sugar, it said. Südzucker, which produces and distributes sugar, sweeteners, molasses, food additives, ice cream and frozen foods, operates mainly in southern and eastern Germany, Belgium, Austria and eastern Europe, while SLS produces and distributes sugar, molasses and alcohol, mainly in France and eastern Europe.