19th Dec 2025 09:26
(Alliance News) - 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 GBP4.7 million in the 52 weeks to September 28, 2024 from GBP3.6 million the year before, as finance expenses rose to GBP7.6 million from GBP6.8 million. Revenue decreased 8.6% to GBP446.8 million from GBP489.0 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.
By Tom Waite, Alliance News editor
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