Ottawa, July 4, 2007 -- The Competition Bureau announced today the finalization of a series of remedies to maintain and promote competition in the grain handling industry in Western Canada.
"We are very pleased with this pro-competitive outcome, which puts an end to a long-running concern," said Commissioner of Competition, Sheridan Scott. "We believe these steps will promote competitive prices for farmers and grain handling companies in the Prairies and the ports," she said.
These transactions resolve competition concerns that arose from a series of mergers in the grain industry. The Bureau concluded that divestitures were required to address those concerns.
Agricore United (the merged entity of UGG and Agricore Cooperative) has completed the divestiture of its AUV grain handling terminal (http://www.competitionbureau.gc.ca/internet/index.cfm?itemID=2302&lg=e) in the Port of Vancouver to Alliance Grain Terminal Ltd., formerly Terminal West Ltd. The divestiture is in accordance with the October 2002 consent agreement (http://www.competitionbureau.gc.ca/internet/index.cfm?itemID=459&lg=e) between the Commissioner and United Grain Growers Ltd. (UGG), and was required in order to eliminate the substantial lessening of competition resulting from UGG's acquisition of Agricore Cooperative. Grant Thornton Limited was appointed as divestiture trustee to conduct the sale process. Alliance Grain Terminal Ltd. is a consortium composed of Paterson Globalfoods Inc., Parrish & Heimbecker Ltd., Prairie West Terminal Ltd., Weyburn Inland Terminal Ltd., Great Sandhills Terminal Marketing Centre Ltd., and North West Terminal Ltd.
As required by the March 2007 consent agreement
(http://www.ct-tc.gc.ca/CMFiles/CT-2007-005_0002_45LSZ-3292007-6212.pdf?windowSize=popup) with the Commissioner of Competition, Saskatchewan Wheat Pool (SaskPool) has completed the sale of nine inland grain elevators and a port terminal elevator in the Port of Vancouver to Cargill Ltd. Cargill Ltd. now owns what was formerly the SaskPool Terminal and SaskPool owns the Cascadia Terminal in its entirety. In addition, SaskPool has terminated the Pacific Gateway Terminal Ltd. joint venture with James Richardson International (JRI) on the North shore of Burrard Inlet in Vancouver. As the joint venture is now dissolved, the Commissioner will be withdrawing her application to the Tribunal challenging this joint venture. These remedies were required to eliminate the substantial lessening of competition resulting from SaskPool's acquisition of Agricore United in June 2007.
The Commissioner and James Richardson International (JRI) have also entered into a new consent agreement, whereby JRI will divest two inland grain elevators in Glossop and Swan River, Manitoba. The Commissioner requires the divestitures in order to eliminate the substantial lessening of competition in local markets resulting from JRI's acquisition of certain Agricore United inland grain elevators from SaskPool.
"With the cooperation of the parties, we were able to reach a favourable resolution in the case of the SaskPool and JRI consent agreements in a very short time frame," said Commissioner Scott.
The Competition Bureau is an independent law enforcement agency that promotes and maintains fair competition so that all Canadians can benefit from competitive prices, product choice and quality services. It oversees the application of the Competition Act, the Consumer Packaging and Labelling Act, the Textile Labelling Act and the Precious Metals Marking Act.
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