The European Commission has decided that the merger between coffee manufacturer DE Master Blenders 1753 and food concern Mondelez International is no threat to the free market. Once finalized, the new company will be called Jacobs Douwe Egberts.
Fear of price hikes
The European Commission launched an investigation into the merger last year, because it feared that would lead to price hikes as both companies have plenty of coffee brands in their portfolio. Particularly in the coffee pad market, both companies have quite a bit of influence. To get the merger approved, Mondelez will sell its shares in Carte Noir (Europe), while DE Master Blenders will sell off its European Merrild activities.
The deal will give Mondelez 5 billion dollars (4.5 billion euro) and 49 % of shares in the new company, called Jacobs Douwe Egberts. DE Master Blenders will get the remaining 51 % and the guarantee that the merger company's main office will be in the Netherlands.