Watchdog scrutinises Lobels buyout

CLOUDINE MATOLA

A proposed takeover of Lobels Holdings by Mega Market has come under regulatory scrutiny in a deal that could redraw Zimbabwe’s competitive landscape in the food manufacturing and fast-moving consumer goods (FMCG) sectors.

The Competition and Tariff Commission (CTC) has opened a formal investigation into Mega Market’s proposed acquisition of 100% of Lobels Holdings, signalling concerns over the transaction’s potential impact on competition, market concentration and consumer welfare.

The merger would combine one of Zimbabwe’s largest bread and confectionery producers with an established FMCG manufacturer and milling business, making it one of the most significant consolidation moves in the country’s food industry in recent years.

In a notice, the competition watchdog said the investigation, conducted under Section 28 of the Competition Act [Chapter 14:28], will determine whether the transaction is likely to substantially lessen competition, create a dominant market position or otherwise run contrary to the public interest.

“The Commission wants to determine whether the proposed merger is likely to substantially lessen the degree of competition in Zimbabwe or any substantial part of it, or is likely to result in the creation of a monopoly situation which is or will be contrary to the public interest as provided for in Section 32(4) of the Act,” the CTC said.

The Commission said it will assess how the merging parties currently compete in the market, the structure of the industry, the position of rival firms and the likely competitive dynamics should the acquisition be approved.

“The investigation also seeks to ascertain how the merging parties, and other related players, operate in the market before the merger, as well as envisage how the merging parties will operate should the transaction be approved by the Commission, and any other related issues,” it said.

The CTC has invited consumers, competitors, suppliers and other interested stakeholders to submit written representations on the proposed merger by August 7, 2026, as part of its public interest and competition assessment.

The regulator’s findings will determine whether the acquisition proceeds unconditionally, is approved subject to remedies designed to preserve competition, or is prohibited altogether.

Lobels is among Zimbabwe’s leading manufacturers and distributors of bread and confectionery products, with a nationwide footprint. Mega Market manufactures and distributes fast-moving consumer goods and wholly owns Mega Market Milling.