The Competition and Markets Authority has provisionally cleared most of the proposed acquisition of Hovis Group Limited by Associated British Foods plc, while raising competition concerns specific to Northern Ireland. The deal, agreed on 15 August 2025, would see ABF acquire Hovis via its subsidiary ABF Grain Products Limited.

ABF's stated rationale was to drive significant cost synergies and efficiencies, creating a profitable and sustainable UK bread business. Its own operation, Allied Bakeries, brands include Kingsmill, Allinson's and Sunblest, has been loss-making for 14 years, weighed down by declining demand, rising costs for energy, wheat and distribution, and a shift toward lower-margin private label products. ABF funded those losses while pursuing successive restructuring initiatives, none of which returned the business to profitability.

The CMA examined internal documents, spoke to potential buyers and assessed the realistic alternatives. Its provisional conclusion is that Allied Bakeries would exit the market entirely if the merger did not proceed, and that no credible buyer exists for the GB business as a going concern. On that basis, the merger is provisionally cleared in Great Britain: if AB closes regardless, the transaction does not materially worsen competition.

Northern Ireland is treated separately. AB's NI operation is profitable, uses a distinct distribution model, carries stronger brand recognition than its GB counterpart, and ABF has already run a sales process there that attracted non-binding offers from third parties. The CMA provisionally concluded that an alternative buyer would likely have kept the NI business competing with Hovis, making the merger's effect there a genuine competition concern.

The market positions involved are significant. In NI, the merged entity would control nearly two-thirds of bread sales and over 80% of pancakes, alongside dominant shares in soda farls and potato farls, including in private label. Smaller suppliers such as Irwin's, Brennans and Gallaghers are present but hold limited share.

The interim report is not a final decision. Interested parties have until 16 April 2026 to respond, and a remedies process is under way. The outcome may hinge on whether a structural solution, such as a separate divestment of the NI assets, can satisfy the CMA's concerns while allowing the broader deal to complete.