Entry into pasta and water
Aldi and Lidl are allowed to take over suppliers
12/01/2022, 12:00 p.m
Altmühltaler Mineralbrunnen and Erfurter Pasta are among the most important producers of mineral water and pasta in Germany. However, they are soon in the hands of their previous customers: the Federal Cartel Office has no problem with takeovers of Aldi and Lidl.
The Federal Cartel Office has given the discounter Aldi and the Schwarz Group around Lidl and Kaufland the green light to take over important German private label manufacturers. Aldi Nord can thus acquire, among other things, Altmühltaler Mineralbrunnen GmbH and Vitaqua GmbH, the Schwarz Group can buy the pasta manufacturer Erfurter Teigwaren GmbH, as reported by the competition authority. The companies are important manufacturers of private labels in their areas for the German market.
“When large retail chains take over food manufacturers, the question always arises from a competitive perspective as to whether there is a threat of foreclosure of the markets to the detriment of other producers or other retailers,” writes the President of the Federal Cartel Office, Andreas Mundt, in a statement. However, the examinations by the competition authority had shown that even after the takeover there would be sufficient alternatives on the market for both dealers and manufacturers.
The Bundeskartellamt wants to keep an eye on the competitive effects of the so-called vertical integration of manufacturers in the food retail sector.
companies facing major challenges
With a turnover of around 70 million euros, Erfurter Teigwaren GmbH is the largest manufacturer of private label pasta in Germany. However, pasta production has also been new territory for the Schwarz Group so far. According to the trade journal “Lebensmittel Zeitung”, the discounter Lidl, which belongs to the Schwarz Group, already produces chocolate, baked goods, drinks, ice cream, pasta and coffee for its own brands. Aldi already operates coffee roasting plants.
Altmühltaler and Vitaqua produce and sell mineral water, non-alcoholic beverages and packaging material at the Treuchtlingen and Breuna locations. In Germany you are one of the largest manufacturers of private labels in the field of mineral water drinks for discounters. However, Aldi has not yet been active in the production of mineral water beverages, so the takeover will not result in any additional market shares in this market.
Around 500 people are employed at Altmühltaler alone, and Aldi Nord says they all want to take over. Again Bavarian radio reports, the family business is facing major challenges: the water rights will expire in three years and a new application will have to be made. However, new funding is probably only possible with a gentler process. In addition, according to a new EU directive, the lids of plastic bottles must be firmly attached to the bottle in the future. This is intended to reduce plastic waste, but Altmühltaler has to invest in new production lines for production in the double-digit millions.