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RWZ and Landgard withdraw planned merger in horticultural supply sector after concerns expressed by the Bundeskartellamt

Date of issue: 23.02.2018

Raiffeisen Waren-Zentrale Rhein-Main eG ("RWZ") and Landgard Blumen & Pflanzen GmbH & Co. KG ("Landgard") have abandoned their plans to set up a joint venture under the name Raiffeisen Gartenbau GmbH & Co. KG ("Raiffeisen Gartenbau"). Under the project Landgard was to acquire 25 per cent of the shares in Raiffeisen Gartenbau and in return bring its horticultural supply centers into the joint venture. RWZ was to hold 75 per cent of the shares.

Andreas Mundt, President of the Bundeskartellamt: "The project would have significantly worsened the conditions of competition in this sector to the disadvantage of horticultural businesses in North Rhine-Westphalia. We therefore informed the parties in writing of our preliminary concerns and announced that we were considering prohibiting the project. The parties then withdrew their notification."

The companies notified the project to the Bundeskartellamt on 26 October 2017. After conducting extensive enquiries among manufacturers, competitors and customers, the Bundeskartellamt came to the preliminary conclusion that the joint venture would create a dominant position on the relevant market.  On 31 January 2018 the Bundeskartellamt therefore issued a statement of objections regarding the planned merger. The companies subsequently withdrew their notification on 19 February 2018 after the deadline for comments had expired.

The markets which the Bundeskartellamt examined in this case are a regional market for plant pots and packaging used in the horticultural industry, which is limited to North Rhine Westphalia, and a regional market for the entire range of horticultural supplies. The joint venture would have achieved a market share of 45-50 per cent on the regional market for plant pots and packaging and a 50 per cent market share on the regional full-range horticultural supplies market with a clear lead over the next closest competitor. The market assessment also included the direct sales of manufacturers of pots and trays from within Germany and abroad. There are also high barriers to entry on this market. The surveys conducted among the market participants have also shown that purely online dealers are not and will not be a plausible alternative channel of supply for the horticultural businesses in coming years. In its customer enquiries the Bundeskartellamt based its findings on a representative random sample of the horticultural businesses affected in the Lower Rhine region.

The RWZ is a central cooperative active in the agricultural wholesale sector. Its area of business covers around 100 locations across large parts of North Rhine-Westphalia, Hesse, Thuringia and Saxony, the whole of Rhineland-Palatinate and Saarland.

The Landgard group is a cooperative which is primarily active as a distributor of flowers and plants as well as vegetables and fruit on behalf of the producers. It operates locations in Germany and nine other European countries.

Press release (pdf)

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