The proposed buyout of Sussex Mushrooms by Monaghan Mushrooms has been given the go-ahead by the Office of Fair Trading despite fears it would create a lack of competition.
The deal means Monaghan, the UK’s biggest mushroom grower, will gain further supply to Asda and Morrisons on top of its Tesco and Sainsbury’s contracts, strengthening its position in the market.
Sussex Mushrooms was bought by Monaghan subsidiary Thakeham Mushrooms in April and the company was put into liquidation.
After the OFT’s decision was announced Monaghan Mushrooms chief executive, Ronnie Wilson, said he was always confident the purchase would get the green light.
“This is an important decision as it represents the start of a bright future for mushroom growing in Sussex. The farm is loss-making and some investment and restructuring will be required, however there will be no material reduction in employment,” he added.
Horsham County Council welcomed the news that the jobs of all 470 Sussex Mushrooms employees would be secured.
Councillor Robert Nye, leader of Horsham District Council, said: “The survival of Sussex Mushrooms will be very good news for the local economy.”
Northern Mushrooms’ managing director, John Smith, said the merger could be useful for league two players because supermarkets may want to look at backup suppliers. However, he said the overall impact would not be vast.
“It will cement Monaghan as being head and shoulders above everyone else in the industry but I don’t think it will make any
difference,” he said.
Production of mushroom compost is planned to be moved to Monaghan’s existing site in Hampshire in 2013
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