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The UK Competition & Markets Authority on Friday launched a formal investigation of the planned acquisition of Hovis Group Ltd by Associated British Foods PLC. The CMA said the phase 1 probe began with notice to AB Foods and Hovis on Friday. The competition watchdog has until February 19 to reach a decision. The probe, in CMA’s standard language, is to determine whether or not the merger ‘may be expected to result in a substantial lessening of competition within any market or markets in the United Kingdom for goods or services’. Back in May, AB Foods, a London-based food processing and clothing retailing business, confirmed talks with Hovis-owner Leeds-based Endless LLP, for a potential acquisition. At the time, AB Foods said it was evaluating strategic options for its Allied Bakeries division, as it continued to face a ‘very challenging market’. Allied Bakeries owns the bread brands Kingsmill, Allinson’s, and Sunblest. It also produces own-label bakery ranges for major UK supermarkets. In August, AB Foods confirmed it will combine Hovis with Allied Bakeriesto create a ‘profitable UK bread business that is sustainable over the long term’. No financial details of the deal were disclosed. Endless bought Buckinghamshire-based Hovis in 2020 for an undisclosed price. According to Companies House data, the pretax loss at Hovis widened to £4.7 million in the 52 weeks to September 28, 2024 from £3.6 million the year before, as finance expenses rose to £7.6 million from £6.8 million. Revenue decreased 8.6% to £446.8 million from £489.0 million. AB Foods shares were up 0.5% to 2,145.00 pence in London on Friday morning. The company issued no immediate response to the CMA statement. Copyright 2025 Alliance News Ltd. All Rights Reserved.
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