The Australian competition regulator has advised Woolworths that it will not stand in the way of the proposed acquisition of Beak & Johnston after finding it would be unlikely to affect market competition.

According to the Australian Competition and Consumer Commission (ACCC), Woolworths currently holds a 23 per cent interest in Beak & Johnston’s subsidiary City Kitchen, which manufactures ready meals.

The acquisition will result in the supermarket giant owning 100 per cent of Beak & Johnston’s subsidiaries, including its New Zealand business. The New Zealand Commerce Commission is also considering Woolworths’ clearance application for the transaction. 

ACCC commissioner Philip Williams said the deal is not likely to have a substantial anti-competitive effect, as rival suppliers of ready meals will continue to have access to other supermarkets and convenience stores.

They can also distribute through other channels, such as food service wholesaling and direct-to-consumer models, he added.

The review also found that there are a number of large competing suppliers of ready meals with similar scale and capabilities to Beak & Johnston.

“Rival retailers will continue to have options for sourcing quality ready meals to suit a variety of consumer preferences,” Williams elaborated.

The Beak & Johnston brands that will be included in the proposed acquisition are Pitango, Artisano, Strength Meals Co, Simmone Logue and Pasta Master.

A separate subsidiary, Beak & Johnston Pty Ltd, which primarily manufactures sauces, soups and slow-cooked meats at its Greenacre, NSW facility, will be excluded from the deal and will operate as an independent business post-acquisition.