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    PCC Case No. M-2018-006

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    Jay
    Universal Robina Corporation (URC) proposed to acquire assets from Central Azucarera Don Pedro, Inc. (CADPI) and Roxas Holdings, Inc. (RHI). The Philippine Competition Commission reviewed the transaction. It determined that the relevant markets were sugar manufacturing and sugar cane milling services. The acquisition would create a monopoly for URC in these markets by merging the sole competitors. As a monopoly, URC would have unilateral power over prices and services without competitive pressures. Potential substitutions or new competitors were not sufficient to constrain URC's market power. Therefore, the Commission concluded that the transaction would substantially lessen competition in the relevant markets.

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    PCC Case No. M-2018-006

    Uploaded by

    Jay
    250 views2 pages
    Universal Robina Corporation (URC) proposed to acquire assets from Central Azucarera Don Pedro, Inc. (CADPI) and Roxas Holdings, Inc. (RHI). The Philippine Competition Commission reviewed the transaction. It determined that the relevant markets were sugar manufacturing and sugar cane milling services. The acquisition would create a monopoly for URC in these markets by merging the sole competitors. As a monopoly, URC would have unilateral power over prices and services without competitive pressures. Potential substitutions or new competitors were not sufficient to constrain URC's market power. Therefore, the Commission concluded that the transaction would substantially lessen competition in the relevant markets.

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    Universal Robina Corporation (URC) proposed to acquire assets from Central Azucarera Don Pedro, Inc. (CADPI) and Roxas Holdings, Inc. (RHI). The Philippine Competition Commission reviewed the transaction. It determined that the relevant markets were sugar manufacturing and sugar cane milling services. The acquisition would create a monopoly for URC in these markets by merging the sole competitors. As a monopoly, URC would have unilateral power over prices and services without competitive pressures. Potential substitutions or new competitors were not sufficient to constrain URC's market power. Therefore, the Commission concluded that the transaction would substantially lessen competition in the relevant markets.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    250 views2 pages

    PCC Case No. M-2018-006

    Uploaded by

    Jay
    Universal Robina Corporation (URC) proposed to acquire assets from Central Azucarera Don Pedro, Inc. (CADPI) and Roxas Holdings, Inc. (RHI). The Philippine Competition Commission reviewed the transaction. It determined that the relevant markets were sugar manufacturing and sugar cane milling services. The acquisition would create a monopoly for URC in these markets by merging the sole competitors. As a monopoly, URC would have unilateral power over prices and services without competitive pressures. Potential substitutions or new competitors were not sufficient to constrain URC's market power. Therefore, the Commission concluded that the transaction would substantially lessen competition in the relevant markets.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    of 2

    PCC Case No.

    M-2018-006

    In the Matter of the Proposed Acquisition by Universal Robina Corporation of Assets of


    Central Azucarera Don Pedro, Inc. and Roxas Holdings, Inc.

    Universal Robina Corporation of Assets of Central Azucarera Don Pedro, Inc. and Roxas
    Holdings, Inc.

    Facts:

    URC is a Philippine corporation engaged in a food related business which operates into 3
    segments. One of those is the Sugar Division. URC’s UPE is JG Summit Holdings, Inc., a
    Philippine Holding Company who has business in foods and agro-industrial, real estate, air
    transportation, banking and others.

    CADPI is a Philippine corporation engaged in producing and trading raw and refined sugars,
    molasses and other related products. Its UPE is RHI is a publicly-listed Philippine holding
    company engaged in manufacturing sugar and allied products. RHI owns 100% of CADPI’s
    issued and outstanding capital stocks.

    The transaction involves URC’s propose acquisition of all assets of CADPI and the parcel of
    land owned by RHI where CADPI facilities are situated.

    Issue: WON the transaction will substantially prevent, lessen or restrict competition in the
    relevant market.

    Held:

    A merger gives rise to a substantial lessening of competition when it has a significant effect on
    competition, and consequently, on the competitive pressures on firms to reduce prices, improve
    quality, become more efficient or innovative.

    Relevant product markets are sugar manufacturing and provision of sugar cane milling services
    which is a distinct and unique.

    The commission assessed that the acquisition is a merger to monopoly will substantially lessen
    competition. It has unilateral effects (independently exercise unilateral power) and coordinated
    effects (transaction leads to monopoly, no need to prove coordination).

    Transaction will create market power for URC to control planter’s share in the planter-miller
    sharing agreement.

    Potential substitution outside of the relevant market is not sufficient to constrain URC from
    exercising market power. Also, alternative crops are not practical.

    Barriers to entry are high. Building a sugar plant would cost a lot.
    RHI failed to provide detailed and verifiable evidence of supposed benefits that the transaction
    is projected to bring about.

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