Premium Food Group to challenge decision blocking Vion asset deal

GERMANY – Germany-based Premium Food Group is seeking to overturn a decision by the country’s competition watchdog that halted its bid to acquire meat-processing facilities from Dutch rival Vion.

The planned sale, which included several slaughterhouses and processing plants across southern and eastern Germany, was blocked last month by the Bundeskartellamt on grounds that it would reduce market competition.

Vion, which began shutting down meat operations in Germany in 2023, agreed in January last year to sell two plants to Premium Food Group, with additional assets added to the deal later in September.

The facilities in question include slaughterhouses located in Buchloe, Crailsheim, and Waldkraiburg, a deboning plant in Hilden, and hide-processing sites in Memmingen and Eching-Weixerau.

Bundeskartellamt argued that the transaction would give Premium Food Group a dominant position in regional markets, particularly for cattle and pig slaughtering.

It noted that Vion was a leading player in cattle slaughtering in southern Germany and that the deal would give Premium Food Group more than 40% of the market in areas like Buchloe, Waldkraiburg, and Kempten, far surpassing the reach of smaller competitors.

In the Weißenfels region, the agency also warned that Premium Food Group’s position in pig slaughtering would be significantly reinforced through the addition of the Crailsheim facility.

The regulator had issued a formal statement of objections in March to both companies, outlining its competition concerns after collecting feedback from industry players.

In response, the companies submitted remedies in April that involved divesting or leasing some facilities to independent operators, but these proposals were rejected.

The Bundeskartellamt said the commitments were insufficient to prevent the dominance of major market players like Tönnies, another leading German meat processor.

Following the decision, Premium Food Group has now filed for a review of the ruling at the Higher Regional Court in Düsseldorf.

The company is also weighing whether to seek ministerial approval from the Federal Ministry for Economic Affairs and Climate Action, which can override competition rulings in certain circumstances.

In a public statement, Premium Food Group said the authority’s market analysis was flawed and that broader public concerns about agricultural sustainability were being overlooked.

The company added that farmers and other stakeholders had voiced frustration over the blocked deal, urging a resolution to secure long-term investment in southern Germany’s meat sector.

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