The UK competition regulator has dismissed another legal challenge from French bakery group Cérélia following a lengthy effort to acquire dough business Jus-Rol.
The Competition and Markets Authority (CMA) said today (11 April) the Court of Appeal has “fully dismissed” all five grounds of Cérélia’s latest legal challenge. The appeals court upheld the Competition Appeal Tribunal’s (CAT) finding that the CMA was ‘rational and fair’ in its deal review.
In January 2023, the CMA concluded its investigation into Cérélia’s purchase of Jus-Rol, finding the deal would substantially lessen competition and put UK grocers at risk of higher prices and lower quality products – which could ultimately be passed on to shoppers.
Cérélia disagreed with the CMA’s final decision and issued a legal challenge – which was entirely dismissed by the CAT last September.
Joel Bamford, executive director of mergers at the CMA, said: “We are pleased with today’s ruling from the Court of Appeal, which has fully dismissed all five grounds of Cérélia’s appeal, upholding the CMA’s decision which found that the Cérélia / Jus Rol merger would substantially lessen competition.”
He added: “This is the second time Cérélia has been unsuccessful with its legal challenge, first in the CAT and now, in the Court of Appeal. It must now sell off Jus-Rol in its entirety to ensure UK grocers and shoppers don’t face higher prices or worse quality products.”
Cérélia had already given final undertakings to sell the Jus-Rol business but this process was suspended pending the outcome of Cérélia’s appeal. Following today’s judgment, the CMA now expects Cérélia to commence the sale process.
In a statement to Just Food, Cérélia’s UK subsidiary BakeAway said it was “disappointed” by the decision.
The business also said it will seek to appeal to the Supreme Court and therefore “no steps” will be taken to commence the sale.
It added: “BakeAway remains committed to the acquisition and is optimistic that should the Supreme Court consider the appeal, it will allow the transaction to proceed.”
The French group first submitted a proposal in November 2021 to acquire Jus-Rol’s European business from US-based General Mills. Cérélia’s bid, and consequent purchase of Jus-Rol, included assets in the UK, Germany and Ireland.
However, the CMA blocked the UK side of the deal in 2022.
Jan Boers, managing director at BakeAway, today said: “We’re very disappointed with the dismissal by the Court of Appeal and still believe that the pastry and dough category is in desperate need of innovation and investment.”
He added: “We sought to create a more innovative market offer for UK consumers and a more price competitive category by bringing together our expertise in pastry and dough and the strength of the Jus-Rol brand.”
