Whanganui egg farm Rasmusen's proposed merger with two other North Island egg farms has been granted clearance by the Commerce Commission.
Rasmusen's Poultry Farm, based in Westmere, will merge its operations with Heyden Farms Limited and Henergy Cage-Free Limited under a new holding company, Better Eggs Limited.
The proposal was sent in late July to the Commerce Commission, which weighed up whether the merger would substantially lessen competition in the market.
Commerce Commission chair Anna Rawlings said the egg industry was undergoing a substantial degree of change, with the regulatory ban on caged egg production beyond 2022, supermarkets phasing out colony eggs from 2025 and a significant increase in the demand for free-range eggs.
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Despite the changes in the market climate, the commission was satisfied the merger was unlikely to substantially lessen competition in any New Zealand market.
"Our investigation found a significant number of competing egg producers in each of the relevant markets, including some that are expanding their operations, particularly in the production of barn-laid and free-range eggs. These competitors are likely to constrain the ability of the merged entity to raise prices, reduce service quality, or coordinate their behaviour," Rawlings said.
The merged entity would be in a position to drive cost efficiencies in order to maintain competitive prices and continue to invest in innovation and production over the long term.
Rasmusen's has been approached for comment.