Compass Lexecon advised confectionary manufacturer Perfetti Van Melle on the acquisition of Mondelez’ gum business during proceedings before the Spanish and Portuguese competition authorities. The transaction was completed in October 2023, after final approval from the Portuguese competition authority.
Perfetti Van Melle (“PVM”) is a global manufacturer of confectionary and gum, including brands such as Mentos, Chupa Chups, and Fruittella. In December 2022, it agreed to acquire the gum business from Mondelez International in the United States, Canada, and Europe. The $1.35 billion transaction would be subject to regulatory approval in various jurisdictions. PVM reached out to Compass Lexecon to assist with the merger proceedings.
A Compass Lexecon team advised PVM with a preliminary risk assessment of the transaction across different jurisdictions and supported the parties throughout the merger filings in Spain and Portugal. In particular, we played an important role assisting on product market definition, conducting comprehensive market structure analyses, which encompassed market shares and assessments of concentration levels. We also produced economic analyses related to the importance of product differentiation (including the constraints imposed by private label brands), and the influence of countervailing buyer power from retail chains. Furthermore, we actively engaged in defining the scope of the divestment package.
The team delivered in-depth insights on factors that are essential in transactions in the retail sector, i.e., product differentiation, the role of private labels and countervailing buyer power. We were also involved in several negotiations with the Portuguese Competition Authority, exploring various alternative divestment packages and contributing to achieving a solution that all parties found satisfactory.
The transaction was cleared unconditionally in Spain, and with conditions and obligations by the Portuguese Competition Authority in October 2023.
The Compass Lexecon was led by Lorenzo Coppi, Elena Zoido, and Helder Vasconcelos, and included Martina Caldana, Tania Fernandez Navia, Andrea Abbad, Gonçalo Gomes, and Pedro Pereira. They worked with a team from Linklaters led by Lucio D’Amaro, with Carlos Pinto Correia leading Portuguese proceedings, and Jaime Perez Bustamante and Juan Passas leading Spanish proceedings.