Foodstuffs disputes plan to spin off Pak'nSave
Thursday 1 October 2026 · 2 outlets · 2 reports · updated In this story National Party, NZ First, Nicola Willis, Ministry of Business, Innovation and Employment, Commerce Commission, Foodstuffs
Foodstuffs has released a commissioned review from Houston Kemp criticising proposals to separate Pak'nSave from New World and Four Square. The report disputes the economic benefits of the split, claiming the move could lead to industry-wide losses over the next 20 years.
Key facts
4 facts
- Sense Partners estimated a $2.9 billion economic benefit over 20 years from a Pak'nSave split
- Houston Kemp predicts industry-wide losses over 20 years if the split occurs
- Sense Partners' modelling suggests prices would be 3.5% lower on average in the first year
- Foodstuffs net profits currently amount to 2.3% of sales
The full story
1 min read · 2 outlets
Foodstuffs has released a review commissioned from Houston Kemp that criticises modelling regarding the proposed separation of Pak'nSave from New World and Four Square. The review describes the projected benefits as an "economic mirage" and claims the split would result in "industry-wide losses over the next 20 years".
A cost-benefit analysis by Sense Partners, commissioned by the Ministry of Business, Innovation and Employment, estimated that splitting the business would benefit the economy by $2.9 billion over 20 years. This modelling suggests consumers would be $13.1 billion better off over that period.
The Houston Kemp report argues that Sense Partners' modelling is based on an unsupported assumption that Foodstuffs brands do not currently compete with one another. Houston Kemp also stated that Sense Partners' cost assumptions had not been tested with industry participants.
The National Party proposes directing the Commerce Commission to assess the merits of the separation. While National and New Zealand First support a Pak'nSave split, Labour proposes separating wholesale and retail arms, the Green Party suggests a state-owned KiwiMart, and the ACT Party is avoiding structural separation.
Where reports differ
- The Sense Partners study was peer-reviewed by John Davies, who called it an "impressive piece of work", whereas Houston Kemp called the conclusions "economically implausible"
Compiled from reports by The Post and RNZ.
