Foodstuffs North Island (FSNI) and Foodstuffs South Island (FSSI) will appeal the Commerce Commission’s decision to deny approval for their merger, arguing that combining into a single nationwide co-op will help deliver more affordable prices at the checkout. 

“Customers have been asking for better value at the checkout, and we believe this merger is the single biggest way we can keep improving to achieve that,” said Chris Quin, CEO of Foodstuffs North Island and CEO-designate of the proposed nationwide New Zealand co-op, the only real rival of Woolworths.

“By merging our resources, we can make our buying and operations more efficient, which ultimately translates into better prices for New Zealanders.” 

Local family grocers own and operate the more than 500 stores of the two regional co-ops. The Commission was concerned that the merger would eliminate independent competition among co-operatives for purchasing goods from suppliers. 

Additionally, the Commission expressed worry that a combination would result in lower profit margins for suppliers, as well as believed that a combination would increase the probability of ‘co-ordination’ with Woolworths.

Mary Devine, CEO of Foodstuffs South Island, emphasised the merger’s long-term benefits for customers and communities, including better efficiency and speedier innovation. 

“Combining our operations allows us to streamline operations, reduce overheads and better invest in new technology and services that our customers want. This isn’t just a merger – it’s an evolution to ensure we remain competitive and sustainable for the future,” said Devine.  

FSNI and FSSI together filed an application with the Commerce Commission for permission to merge into a single New Zealand-owned co-op in December 2023, however, the Commission indicated last month that approval would not be issued.