The Competition and Markets Authority (CMA) completed a Phase One investigation of the Greencore and Bakkavor merger.

The two food-to-go- giants announced a £1.2bn takeover deal earlier this year which will create a UK food business with a combined revenue of £4bn.

The watchdog concluded that the proposed acquisition does not lead to unfair competition concerns.

The CMA previously raised concerns about the deal leading to a substantial lessening of competition in the UK chilled sauces category.

However, the company is required to bring in solutions to address the potential concerns to avoid a more in-depth investigation in Phase Two.

Dalton Philips, chief executive of Greencore, said: “The CMA process has been constructive, and the Phase One decision is a welcome one, confirming our view of the highly complementary nature of our businesses and product portfolios across ‘food for now’ and ‘food for later’.

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“I am really grateful to my colleagues at Greencore and Bakkavor for successfully getting us to this point, and we are now working with the CMA and Bakkavor for the benefit of all our stakeholders to complete the Bakkavor transaction early next year.”

Mike Edwards, chief executive of Bakkavor, added: “Today’s positive news from the CMA is a significant step forward in the process, providing welcome clarity which means we can collectively work at pace and stay on track to complete the transaction in early 2026.

“Bakkavor is in great shape, and we remain excited about joining the Greencore business and unlocking all the associated benefits we have highlighted for colleagues, customers and shareholders. I would like to thank everyone in Bakkavor and Greencore who has worked so hard in getting us to this advanced stage in the process.”

Moving forward, the businesses plan to work with the CMA to reach an agreement.