The Competition Commission of Singapore (CCS) has cleared a proposal made by Dutch coffee company Jacobs Douwe Egberts (JDE) to acquire the entire issued and outstanding share capital of Malaysian coffee firm OldTown Berhad (OT) for approximately MYR1.74bn ($376m).

JDE and OT distribute instant coffee mixes and instant milk tea mixes in Singapore. To study the market impacts of the proposed transaction, CCS carried out consultations with retailers, suppliers and consumers in the country.

“The two companies already face competition from a number of suppliers, including Nescafé, Gold Roast and Alicafé.”

CCS found that the two companies already face competition from a number of suppliers, including Nescafé, Gold Roast and Alicafé. Therefore, it is said that the merger will not pose any threat or entry barrier for the existing suppliers in the country and would be able to increase JDE and OT’s production in response to an increase in demand.

The CCS also noted that the transaction would not impact competition in terms of supply of the instant coffee mixes and instant milk tea mixes for in-home sales in Singapore.

JDE is a global company that currently owns various coffee brands in more than 27 countries, including Australia, Europe and Latin America.