The Competition and Markets Authority (CMA) is reviewing the proposed £50m sale of Dorset Cereals to Associated British Food (ABF).
In June, Wellness Foods, parent company of the Dorchester-based cereal brand announced it was selling Dorset Cereals to ABF, the group behind The Jordans & Ryvita Company.
The CMA has now launched an invitation to comment on the deal, to determine if the sale would lead to a “substantial” lessening of competition in the UK or international markets.
A statement from the CMA said: “The CMA is considering whether it is, or may be, the case that this transaction has resulted in the creation of a relevant merger situation under the merger provisions of the Enterprise Act 2002 and, if so, whether the creation of that situation has resulted, or may be expected to result, in a substantial lessening of competition within any market or markets in the United Kingdom for goods or services.”
The sale was announced in June this year, and it was reported the business was competing with Kellogg’s and Weetabix to acquire the cereal brand for the estimated £50m.
At the time, a spokesman for ABF said: “We can confirm that The Jordans & Ryvita Company, part of Associated British Foods, has reached an agreement to purchase the Dorset Cereals brand from Wellness Foods, subject to regulatory approval.”
A spokesperson from Dorset Cereals said: “This is an ongoing, confidential process and the deal is yet to be concluded, subject to regulatory approval.”
Dorset manufactures premium breakfast items including porridge, granola, muesli and cereal bars and has annual sales of £40m.
ABF also owns Allied Bakeries, manufacturer of the Kingsmill and Allinson brands.