The Paradise Company Limited has been cleared to proceed with its proposed acquisition of shares in Hugo Canning Company Limited.
The Independent Consumer and Competition Commission (ICCC) recently made this announcement.
“This essentially means that, in its considerations of likely negative effects this acquisition may have on competition, the ICCC did not find any serious concerns,” stated the consumer watchdog.
“On 04th December 2020, Paradise Co lodged a clearance application seeking approval from the ICCC to proceed with acquiring Hugo.
“Paradise Co is 100 percent owned by local companies; namely Nambawan Super Limited and Comrade Trustees Limited, having 91 percent and 9 percent interest respectively. Paradise Co is in the food manufacturing business but more specifically manufactures biscuits, chocolates and beverages (bottled water).
“Hugo, on the other hand, manufactures and distributes imported canned protein. It manufactures the famous Ox & Palm corned beef and the exclusive local importer and distributor of Ocean Blue branded tinned fish, besides other products. Since it is owned by HJ. Heinz Company Australia Limited (“Heinz”), it also does exclusive distribution of Heinz’s products in PNG.”
ICCC Commissioner and Chief Executive Officer, Paulus Ain, said the proposed acquisition required ICCC’s approval as the transaction value was greater than K50 million and would result in Paradise Co having more than 50 percent market share in the affected relevant markets, crossing the two mandatory notification thresholds (for clearance application).
“For any clearance applications, the ICCC is required to assess competition effects associated with the proposed acquisition,” Commissioner Ain clarified.
“If the ICCC is not satisfied that a proposed acquisition will not have, and will not be likely to have, the effect of substantially lessening of competition in a market, the ICCC declines to give clearance for that proposed acquisition.
“Conversely, the ICCC gives clearance if it is satisfied that a proposed acquisition will not have, and will not be likely to have, the effect of substantially lessening competition in the relevant market.”
Commissioner Ain added that the ICCC assessed Paradise Company’s clearance application and was satisfied that the proposed acquisition, if it proceeds, would not have, or would not be likely to have, the effect of substantial lessening competition in the identified markets.
In light of this conclusion, on 31st December 2020, the ICCC gave clearance for this proposed acquisition to proceed.