AGRICULTURE MINISTER MICHAEL Creed has said his department does not have any say in a deal that could have massive impact on Ireland’s beef market.
ABP, the State’s largest meat processing company, is looking to buy part of Slaney Meats. ABP is owned by Larry Goodman, one of the most powerful players in the Irish livestock sector.
The proposed merger has caused anger in farming sector, with several hundred farmers protesting outside the Slaney meat factory near Bunclody in County Wexford earlier this year.
Larry Goodman’s business empire includes ABP, along with several businesses and property investments.
The beef baron has avoided the media for most of his career, but his business dealings came to the public eye during the Beef Tribunal during the 1990s. He also gave evidence in the Mahon/Flood and Moriarty Tribunals.
Goodman is said to be worth in the region of €680 million, reports the Irish Farmers Journal.
Beef baron
The businessman has now set his sights on buying up Slaney Meats – a family business established in 1970, which has gone on to become one of Ireland’s largest beef producers.
IFA President Joe Healy said the ABP/Slaney merger would be bad news for farmers and would drastically reduce competition in the industry.
The sale is subject to the approval of the Directorate-General (DG) for Competition in the European Commission in Brussels.
The decision concerning the sale was moved to a European level because, as the minister understands it, there is a north-south dimension to the Slaney operation. Due to the company’s presence in Northern Ireland, it has been referred to Europe.
Goodman has been compared to Denis O’Brien for holding such a high stake in one sector – in his case, the beef industry, and in O’Brien’s case, the media.
High stake in one sector
O’Brien recently moved to add seven more newspaper titles to his stake by acquiring the Celtic Media Group (CMG). His deal is subject to approval by the Department of Communications and also the competition commission in Ireland.
While the National Union of Journalists have called on Communications Minister Denis Naughten to intervene in the O’Brien sale, Joe Healy of the IFA is making similar calls on Minister Creed on behalf of farmers.
He said the minister should “immediately intervene with the Competition and Consumer Protection Commission (CCPC) to insist that they seek the referral of the ABP/Slaney case from DG Competition in Brussels back to Ireland for investigation so that serious issues around competition in the sale of cattle are fully investigated”.
Competition in the industry
Healy said he “deplored attempts by the CCPC to wash their hands of the ABP/Slaney deal and ignore the serious competition issues in the Irish market by leaving the investigation of the case to the Brussels authorities”.
In an interview with TheJournal.ie, Creed said ABP owns about 22% of the slaughter capacity in Ireland at the moment.
If they get their wishes in terms of Slaney I think their market control will be in the region of 28%. Now that is a significant chunk and we need to have competition in the market. The issue was referred to the competition authority by the parties to the agreement which is ABP and Slaney…
If the sale proceeds, ABP will own more than 36% of the premium cattle market nationwide.
My department hasn’t got a role in determining the outcome, but we have made observations to the commission on the matter.
The IFA President said Irish livestock farmers are seriously concerned over the weak competition for cattle in the Irish market and that the ABP/Slaney deal would further reduce competition.
‘Passing the buck to Brussels’
“Minister Creed cannot allow the Irish competition authority to escape their responsibilities and pass the buck onto Brussels,” said Healy.
Farmers expect Minister Creed to follow up on his predecessor Minister Coveney’s intervention with the CCPC last spring and formally request that they investigate the very real concerns over competition in this case.
The power struggle between the IFA and Goodman has caused tensions to rise.
Much to the shock of the IFA, last month ABP decided to stop the automatic collection of levies from farmers, which go towards funding the IFA and other farming groups.
Letters were sent to suppliers informing them that from now on the levy will be an “opt-in” payment and would no longer be collected automatically from farmers.
With hostilities at an all-time high, Healy hit back at Goodman, stating that farmers will not be dictated to by Larry Goodman on how the IFA does its business.
ABP will not dictate how IFA represents farmers or how farmers decide to support their Association.
The IFA sees the move as an attack on its funding model in retaliation to its opposition to ABP’s planned buy-out of Slaney Foods.
Creed told TheJournal.ie that the Department of Agriculture have no part to play in the dispute over levy collections.
These are to do with levies my department have nothing to do with and they are issues between those parties.
All I would say is, the farm industry is well served by well resourced farming organisations.
How they are resourced in terms of the levies is an issue between those farming organisations and the industry. I hear what is going on, but it is not a role the department has any position on.
A statement from ABP provided to RTÉ on the sale, stated:
ABP Food Group is in a regulatory process with the EU Commission regarding the proposed 50:50 joint venture with Fane Valley Co-Op in relation to Slaney Foods. The company … is confident that the transaction will be approved in the coming months…
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