The Philippine Competition Commission has approved the acquisition by SM Retail Inc. of Goldilocks Bakeshop Inc.
SM Retail is a subsidiary of SM Investments Corp. which through another subsidiary, SM Prime Holdings Inc., develops, owns and operates shopping malls. SMPHI operates close to 70 malls in the Philippines, while Goldilocks has a network of more than 500 stores, some of which operate in SM malls. Post-merger, Goldilocks will become a subsidiary of SM Retail.
A major finding by the review undertaken by MAO is the possibility of partial or total foreclosure in the supply of retail space in SM malls to competitors of Goldilocks after its acquisition by the SM Group.
“While selection of tenants in a mall is market-driven and based on consumer preferences, a mall operator should not be allowed to discriminate mall tenants and lease applicants, especially those that compete with stores owned by the mall itself,” said PCC Chairman Arsenio Balisacan.
“Such discrimination or unfair treatment can come in the form of arbitrarily assigning competitor tenants to disadvantageous locations or unfavorable lease terms, which amounts to partial foreclosure. It can also come in the form of giving less favorable lease terms or completely refuse them lease space in the mall, which amounts to total foreclosure,” Balisacan added.
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