In a statement, Farmlands said the purchase would bring the co-operative’s feed business — NRM and McMillan — together with SealesWinslow, increasing Farmlands’ feed manufacturing footprint into the North Island.
"Bringing our combined assets, expertise and market reach together, offering three leading animal nutrition brands, we’ll increase our ability to create long-term benefits and value for shareholders and customers", chief executive Tanya Houghton said.
Both parties manufactured and distributed animal nutrition products for production animals.
In reaching its decision, the commission considered the potential impact of the proposed acquisition on competition in regional markets for the bulk supply of supplementary feed for ruminants and, separately, the bagged supply of supplementary feed for ruminants, particularly for calves.
The commission raised potential concerns with the proposed acquisition because Farmlands and SealesWinslow were the two main suppliers of bulk and bagged pelletised compound feed for ruminants in various regions throughout New Zealand.
But after further investigation, division chairman Dr Derek Johnston said the commission was satisfied the acquisition was unlikely to substantially lessen competition.
‘‘Our investigation indicated that, while the merging parties are both significant suppliers of pelletised compound feed for ruminant animals such as dairy cows and calves, they also compete with suppliers of other types of supplementary feed for ruminants.
‘‘These other feeds include single grains, often referred to as ‘straight’ feed, or feed that is a combination of grains, often referred to as ‘blend’ feed.
‘‘This means that farmers have choices other than just pelletised feed. As a result, we are satisfied that Farmlands is unlikely to be able to significantly increase prices, or lower the quality, of its bulk and bagged feed,’’ Dr Johnston said.
The completion of sale is planned for June 1, and Ms Houghton said the Farmlands team would begin working closely with Ballance and SealesWinslow leadership to ensure the transition was ‘‘a positive one for the teams involved’’.
"The key thing to note is that SealesWinslow will continue to produce its own leading brand of nutrition products and service its existing customers as it always has", she said.
SealesWinslow was first established in 1968. In 2011, Ballance purchased 51% of SealesWinslow, and acquired the remaining 49% in 2013.
