Mainland/Southern Fresh application received
Issued 21 December 2001/143
Commerce Commission receives clearance application from Mainland Products to acquire Southern Fresh
The Commerce Commission has received an application from Mainland Products Limited, and any of its interconnected
corporate bodies to acquire up to 100% of shares or assets of the Southern Fresh Milk Company Limited.
Mainland's business activities include the manufacture of fresh and UHT milk, cream, yoghurt, other cultured milk
products and specialty cheeses; the packing, wholesaling and marketing of certain dairy products for the domestic
market; the manufacture and packaging of specialty cheeses for export; the wholesaling of processed meats and small
goods; and the supply of chilled food products.
The major brands of dairy products owned and used by Mainland are Mainland, Valumetric, Galaxy, Ferndale, Tararua and
Meadow Fresh. Of particular relevance to this application is Mainland's involvement in the processing and wholesale
supply of town milk in the South Island.
Southern Fresh is a processor and wholesaler of town milk. It is also a manufacturer of ice cream for export.
In considering the application, the Commission's role is to determine whether the merger has the effect of substantially
lessening competition in the market.
A public version of Mainland's application is available on request from the Commerce Commission. Please contact
Catherine Best, (04) 494-0953. Background On 17 April 2001, Mainland applied for clearance to acquire Southern Fresh.
The Commission declined that application because it was not satisfied the merged entity would not acquire or strengthen
a dominant position in the South Island town milk market. Two of the Commission's primary reasons for declining
clearance were uncertainty regarding the regulatory climate and uncertainty as to whether NZ Dairy Foods would build a
new plant in the South Island.
Legislation regulating the dairy industry has now been enacted and NZ Dairy Foods has announced that it will have built,
and be operating, a South Island town milk processing plant by the end of March 2002.