The approval allows Orkla’s takeover of NP Foods including all of the Latvian and Lithuanian food companies owned by NP Foods and their respective subsidiaries after concluding that the takeover would not unfairly hinder competition in the respective markets, Vilsone said.
The Latvian competition watchdog ruled that the competitive environment in the Latvian and Baltic markets would not be significantly affected by the takeover in the market segments represented by the parties involved, namely, juices, chocolates, candies, pastry, pre-made dressings and soups.
As a result of the transaction, Orkla will acquire sole control over NP Foods group by buying 100 percent of NP Foods shares, 100 percent of shares in Latvian juice producer Gutta, 100 percent of shares in the Latvian sweets maker Staburadze and 100 percent of shares in each of the Lithuanian companies – Margiris and Detente, as well as 24.6 percent of shares in the Latvian chocolate maker Laima (the remaining 75.4 pct in Laima are held by Staburadze).
A takeover deal needs the Competition Council's approval if the combined turnover of the companies involved in the deal has reached at least 35,572,000 euros in the previous fiscal year or their combined market share exceeds 40 percent.
Norway’s Orkla group does business in Scandinavia, Eastern Europe, Asia and the United States. Orkla already has several subsidiaries that operate in the Baltics, including in Latvia.
In 2004, Orkla purchased Latvia’s leading fruit and vegetables processing company Spilva. The Norwegian food group also owns Latfood potato chips maker in Latvia, Kalev and Poltsamaa Felix in Estonia and Suslavicius-Felix in Lithuania. Orkla’s turnover in 2013 was 3.93 billion euros.
NP Foods group comprises Latvian and Lithuanian food, trade and logistics enterprises Laima, Staburadze, Gutta, Staburadzes Konditoreja, Saldumu Tirdznieciba and NP Logistics. It is the largest holding company in the Latvian sweets and beverages industry, boasting a turnover of 64.323 million euros in 2013 at a 9.4 percent rise from 2012 and a profit of 1.107 million euros, which was 3.6 times more than the year before.