Schnuck Markets, Inc. has applied for Federal Trade Commission approval to divest 23 St. Louis, Missouri-area supermarkets to Family Company of America, which intends to
operate the stores as a single grocery chain under the "national" trade name (see attached list of stores proposed for divestiture). The application will be subject to public comment until Feb. 9.
Schnucks is based in St. Louis. Family Company of America is a newly-formed company, also based in St. Louis, and its senior management consists largely of former senior managers of the National Holdings, Inc. supermarket chain. The divestitures are required under a 1995 consent order Schnucks signed to settle FTC charges that the firm's acquisition of supermarkets owned by National Holdings, Inc. would violate federal antitrust law and potentially lead to anticompetitive pricing and other conduct that could hurt supermarket customers in the St. Louis area. The consent order requires 24 supermarket divestitures so as to restore competition. Schnucks stated in its application that it still is seeking a buyer for the 24th store.
According to the application, the proposed divestiture plan will establish a "substantial competitive force in the market." Family would be the third-largest competitor in the market and its size "will enable it to take advantage of available economies of scale, especially in such areas as purchasing and advertising, and its use of the national' trade name will help ensure an immediate procompetitive impact," the application states. Schnucks also maintains that the proposed subleases of real estate on which some of the stores are owned "will not adversely affect the ability of incentives of family, schnucks, or any other party to compete."
Comments on the application should be addressed to the FTC, Office of the Secretary, 6th Street and Pennsylvania Avenue, N.W., Washington, D.C. 20580.
Copies of the application and the order are available from the FTC's Public Reference Branch, Room 130, 6th Street and Pennsylvania Avenue, N.W., Washington, D.C. 20580; 202-326-2222; TTY for the hearing impaired 1-866-653-4261. To find out the latest news as it is announced, call the FTC NewsPhone recording at 202-326-2710. FTC news releases and other materials also are available on the Internet at the FTC's World Wide Web site at: http://www.ftc.gov
(FTC Docket No. C-3585) (schnuck3)
Stores Proposed for Divestiture