Bureau Approves Beef-Packing Merger
The Competition Bureau released a Technical Backgrounder on August 31, 2005 that outlines the reasoning behind its approval of the acquisition of the Better Beef Group of Companies (Better Beef) by Cargill Limited (Cargill"). Better Beef and Cargill are both integrated beef packers, who slaughter cattle and fabricate, package and market beef products. The Bureau examined in depth the potential upstream impact on competition for Canadian cattle, as well as the downstream impact on Eastern Canadian competition for the sale of case-ready beef (meat cut and packaged suitable for display in retail stores). On the buying side, the Bureau concluded there are separate Western and Eastern cattle markets and minimal actual overlap between the parties. For case-ready beef, despite the large market shares of the parties, the Bureau concluded that the threat of entry by and the countervailing power of retail grocery firms make the merger unlikely to lessen or prevent competition substantially in any relevant market.
