AUTHORISATION TO ACQUIRE AB „ROKIŠKIO SŪRIS“ SUBJECT TO THE OBLIGATION TO SELL AB „KELMĖS PIENINĖ“

The Competition Council examined the notification filed on January 7, 2004 by A. Trumpa, UAB “Pieno pramonės investicijų valdymas”, UAB “Survesta” and UAB “Snavesta” concerning the merger by acquiring up to 100 per cent of shares of AB “Rokiškio sūris” and acquiring the total control of AB “Rokiškio sūris”.

The Competition Council concluded that the merger intended by UAB “Snavesta”, UAB “Pieno pramonės investicijų valdymas”, UAB “Survesta” and A. Trumpa was to be designated as a conglomerate and horizontal merger in the milk purchase and dairy product markets. While holding a significant share of the milk purchase market AB “Rokiškio sūris” exercises a significant impact upon the policy of milk purchase prices. The incorporation of AB “Kelmės pieninė” into the group of AB “Rokiškio sūris” would only amplify the economic power of AB “Rokiškio sūris”, potentially resulting in the dominant position in the dairy market and significant restriction of competition in the relevant market. Furthermore, the three major milk processing companies hold over 80 per cent of the total milk purchase market in Lithuania which further enhances a potential of restriction of competition in the milk purchase market. In view of all the above considerations the Competition Council authorised the notified merger by acquiring AB “Rokiškio sūris” subject to certain conditions and obligations.

Most importantly, UAB “Vinvesta” was obligated within the established period of time to sell all shares of AB “Kelmės pieninė” held thereby. The shares of AB “Kelmės pieninė” are to be sold to an undertaking which according to the Law on Competition is not related with UAB “Vinvesta”, UAB “Snavesta”, UAB “Survesta”, UAB “Pieno pramonės investicijų valdymas” and A. Trumpa. The time limit for the sale of the shares established by the Competition Council was decided to be held confidential. It was also decided that within one month from the authorisation of the above merger the plan-schedule of the sale of shares of AB „Kelmės pieninė“ shall be submitted to the Competition Council by indicating the stages of the sale transactions. The Competition Council shall be notified of all actions and the course of the sale of the shares including the indication of potential buyers, the method of sales, etc. The Competition Council shall be notified of the potential buyer of shares of AB “Kelmės pieninė” not later than within one month prior to the termination of the time limit established for the transaction so that the Competition Council is provided sufficient time to assess and approve the potential buyer.