The Bundeskartellamt, Germany's competition authority, has granted approval for Harry-Brot GmbH to acquire the large bakery Bergkirchen from Glockenbrot Bäckerei GmbH & Co. OHG, which is currently part of the REWE Group. This acquisition will also lead to the formation of two joint ventures with REWE.

Andreas Mundt, President of the Bundeskartellamt, stated that Harry-Brot is the leading manufacturer of bread and baked goods in Germany. The acquisition is expected to strengthen this position further. However, the authority found no significant competitive concerns that would warrant blocking the deal. The assessment concluded that Glockenbrot has primarily produced for REWE internally, and the competitive landscape for other market participants will only change marginally.

Harry-Brot reported a revenue of approximately 1.3 billion euros in the 2024 fiscal year, operating ten production sites for bread and baked goods for retail and other customers. The company is involved in both manufacturer brands and private label supply.

Glockenbrot has produced private label products for REWE from its two locations in Frankfurt and Bergkirchen. REWE plans to exit the production of bread and baked goods and instead collaborate with Harry-Brot for supply. This collaboration includes the acquisition of the Bergkirchen bakery and the establishment of two joint ventures that will operate independently of REWE.

The merger particularly affects the market for self-service bread, which includes industrially packaged, ready-to-eat bread found in retail self-service shelves. Harry-Brot holds over 40% market share in this segment in Germany. The merger represents a vertical disintegration, removing a manufacturer from the REWE retail group. The quantities previously produced by Glockenbrot for REWE were not counted in the overall market volume, but with the new external production, Harry-Brot's market share will increase.

Despite Harry-Brot's strong market position, investigations indicated that sufficient competition will remain post-merger, providing retail companies with ample alternative sourcing options. In fact, the acquisition is expected to enhance competition, particularly in Southern Germany, due to the new facilities.

Furthermore, the merger is not anticipated to significantly harm competing manufacturers, as Glockenbrot's products were previously produced internally for REWE, limiting competition even before the merger.

In addition, the markets for baked goods and bake-off products, which involve pre-baked dough delivered to retailers for finishing, show that the competitive positions of Harry-Brot and Glockenbrot are not concerning.