Industrial sugar products: the Autorité clears the takeover of Lesaffre Frères by Cristal Union

Parties to the transaction

Cristal Union is a French agricultural cooperative group, whose main activity is the production of industrial sugar products, of table sugar under the brand Daddy, of molasses and beet pulp along with the production of ethyl alcohol.

Lesaffre Frères is a French company which operates a sugar refinery located in Nangis, in the Seine-et-Marne department, dedicated to the production of industrial sugar products used in the agri-food industry, as well as co-products linked with sugar production (including molasses and beet pulp).

The Autorité was able to rule out any risk of harm to competition

Insofar as Lesaffre Frères does not market table sugar, the Autorité’s analysis mainly focused on the effects of competition on the production and marketing of sugar for industrial applications (mainly in the agri-food industry) sector. In this regard, the Autorité interviewed various actors in the value chain: sugar beet growers, competitors and clients of companies impacted by the transaction.

The Autorité first ruled out competition risks in the upstream beet supply market. The closest beet processing factory operated by Cristal Union is indeed 80 kilometres away from the Nangis factory, thus at a distance greater than the average beet collection area of 30 kilometres, as highlighted by the investigation. Sugar beet suppliers located in the supply basin of the Nangis factory, who did not have, prior to the transaction, alternative outlets to Lesaffre Frères, do not see their situation impacted by the transaction.

Reassessment of the geographical scope of the downstream market for the production and marketing of industrial sugar products

Further, the Autorité reassessed the geographical scope of the downstream market for the production and marketing of industrial sugar products, considering that it was now of supranational scope rather than of national scope. This was mainly a consequence of the end of sugar production quotas, during the 2017-2018 campaign.

The Autorité thus ruled out any risk of harm to competition in this market, as Cristal Union will continue to face competition from sizeable sugar groups, in France but also in neighbouring countries, such as Südzucker (present in France via its subsidiary Saint Louis Sucre), Tereos, Nordzucker or Pfeifer & Langen.

Following its competitive analysis, the Autorité was able to rule out any risk of harm to competition resulting from the transaction and cleared it without conditions.