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Thailand’s antitrust agency under scrutiny over $11 Billion Tesco Deal Approval
Thailand’s largest conglomerate, Charoen Pokphand Group (CP) won on Friday the Thai antitrust agency’s approval for acquisition of retail giant Tesco Lotus: the Office of Trade Competition Commission (OTCC) voted 4:3 in favour of the US$10-billion takeover deal.
CP Group will gain control of a network of about 2,000 hypermarket and grocery stores across Thailand, and the group already operates 7-Eleven convenience stores and the Siam Makro chain, a wholesale trading business.
But CP Group is barred from other modern-retailing mergers for three years, excluding e-commerce, Thailand’s Office of Trade Competition Commission said Friday.
Billionaire Dhanin Chearavanont’s family is ranked the world’s 13th richest in a Bloomberg report.
But academics have questioned the OTCC decision, saying that Tesco acquisition can potentially damage trade competition in Thailand.
According to Nipon Poapongsakorn, distinguished fellow at the Thailand Development Research Institute the commissioners apparently failed to carefully look at the big picture where CP, via the 7-Eleven convenience store chain, and its targeted acquisition of Tesco Lotus, can dominate in all three market segments: wholesale, discount, and convenience stores, as reported in The Nation.
In some provinces, the combined market share of CP distribution, network would be between 80 to 90 per cent, he added.
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