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Mitolo’s proposed acquisition of Thomas Foods International’s (TFI) potato business has received the green light from the Australian Competition & Consumer Commission.

The sale was first announced in May. TFI has operated its potato business since July 2013, when it acquired Mondello Farms, while Mitolo supplies fresh washed and brushed potatoes to retailers and wholesalers in all states and territories, except Western Australia and Tasmania.

ACCC deputy chair Mick Keogh said the ACCC closely examined the effect of the acquisition on South Australian potato growers, rival packing sheds and retail and wholesale customers of the parties.

“The decline in consumer demand for potatoes has created difficult circumstances for potato growers, which will continue to affect growers regardless of the transaction,” said Keogh.

“However, feedback from potato growers and other industry participants suggested that if Mitolo sought to lower prices it paid growers, most growers would be able to switch to rival packing sheds, and some would be able to swap to growing potatoes for processing into potato products. 

Rival packing sheds could continue to provide “a viable alternative source” of suppl for retail and wholesale customers, the ACCC found, if Mitolo tried to increase potato prices and decrease quality.

“We concluded that growers and packing sheds will continue to be able to access a range of other varieties as well as future varieties that are being developed, allowing them to compete with Mitolo both now and in the future,” said Keogh.

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