Greencore takeover of Williams cleared

THE Greencore takeover of the Tullamore based Williams Group has been cleared to go ahead. The Minister for Enterprise and Employment, Mr Bruton, has decided not to refer the deal to the Competition Authority.

When the parties sought clearance for the takeover, Mr Bruton had 30 days to decide if he wanted to ask the Competition Authority to rule on whether the proposed deal was anti competitive. Late last week the Minister informed the parties that he had decided not to refer the takeover of the mailing and agri trading business to the authority.

In March, Greencore moved to substantially expand its malting business through the £6.8 million acquisition of the Williams Group. The purchase included, the Midlands Malting business in Banagher, Co Offaly, and the Williams Waller agri trading business in 10 midlands locations.

The Williams group has annual, sales around £30 million. Within the private family owned group Midland Malting is thought to cave had profit of around £750,000 last year. However, bad debts hit the agri trading business, leading to losses.

The deal was examined by the Minister to assess its impact on the agri trading market because it would give Greencore an estimated 80 per cent of the Irish malting market and strengthen its position. Mr Bruton's decision means he has decided it will have no adverse effect on competition.

With the takeover of Midland Malting by Greencore there will be only one other domestic malting company, the Malt Company of Ireland, owned by IAWS and located in Ballincollig in Cork. Williams supplies malted barley to Guinness Ireland whose only other malt supplier is the Athy Greencore subsidiary Minch Norton.

Market sources said Greencore's takeover of Williams Waller was "as much a defensive move as anything else". While the takeover strengthens Greencore's agri trading network, it means that Williams Waller will not be taken over by a company which would become a competitor to Greencore.

Analysts expect the acquisition to add about £1 million to Greencore profits next year. In the current year no contribution as anticipated because Greencore is expected to incur substantial costs restructuring the Williams' Waller operation.

The Greencore chief executive, Mr David Dilger, has said the group will not sell any of the Williams Waller outlets.

The Midlands Mailing business' converts 45,000 tonnes of barley into 30,000 tonnes of malt every year. About two thirds of this is exported. This business is expected to add about 30 per cent of output for Greencore. Minch Norton produces about 100,000 tonnes of malting barley a year.