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Two major hog industry mergers have now been approved by Canada's Competition Bureau.
The bureau said Monday it would let Toronto food firm Maple Leaf Foods buy hog producer Puratone Corp. for $42 million as well as allow Quebec meat packer Olymel to buy Big Sky Farms, Canada's second-largest hog producer, out of receivership for $65.25 million.
"In both investigations, the bureau concluded that the mergers were unlikely to lead to a substantial lessening or prevention of competition," it said in a statement.
The bureau said it considered whether Olymel or Maple Leaf would be able to "totally or partially foreclose rivals' access to live hogs in upstream markets... or to limit or cease their purchases of live hogs from upstream rivals."
The bureau said it concluded the buyers would be unable to create or boost market power upstream due to "excess demand" for hogs, and they couldn't create or increase market power downstream for reasons including "effective remaining competition" -- not the least of which would be between Olymel and Maple Leaf.
The bureau did find the two companies may be in a position to hinder other hog producers' access to buyers, but added that neither Olymel nor Maple Leaf would have any incentive to foreclose rival hog farmers from access to their slaughter plants.
Tuesday December 18, 2012/ Alberta Pork/ Canada.
http://www.albertapork.com
