Tag: Competition

The Commission challenged the proposed acquisition by Carlyle Partners IV, L.P. of INEOS Group Ltd., alleging that the deal would be anticompetitive in the highly concentrated Midwestern market for sodium silicate. Sodium silicates are used in detergents and other products, and are important chemicals used by the pulp and paper industry. The acquisition would have joined market leader PQ Corporation, which is owned by Carlyle, with INEOS, the third-largest sodium silicate provider. Under the Commission’s order, Carlyle must divest PQ’s sodium silicate plant in Utica, Illinois, and all associated intellectual property required to operate the plant to Oak Hill Company within five days of consummating the transaction.

The Commission challenged McCormick & Company’s $605 million acquisition of Lawry’s and Adolph’s brands of seasoned salt products from Unilever N.V., alleging that the transaction would be detrimental to competition in the highly concentrated U.S. market for seasoned salts. According to the Commission’s complaint, the proposed deal would combine the two companies that comprise almost the entire $100 million market for seasoned salt, increasing the likelihood that McCormick would be able unilaterally to increase prices. McCormick agreed to divest its Season-All business to Morton, an FTC approved buyer, within 10 days of completing the acquisition.

An administrative law judge upheld the administrative complaint that charged that the North Texas Specialty Physicians (NTSP), a physician group practicing in Forth Worth, Texas, collectively determined acceptable fees for physician services in negotiating contracts with health insurance plans and other third party payers; thus engaging in horizontal price fixing. On December 1, 2005, the Commission issued a unanimous decision upholding the allegations that NTSP negotiated agreements among participating physicians on price and other terms, refused to negotiate with payers except on terms agreed to among its members, and refused to submit payors offers to members if the terms did not satisfy the group’s demands. The Commission concluded that the group’s contracting activities with payors amounts to unlawful horizontal price fixing and that respondent’s efficiency claims were not legitimate and not supported by the evidence.

The respondent appealed the Commission decision to the U.S. Court of Appeals for the Fifth Circuit. The Court agreed with the Commission that the anticompetitive effects of NTSP’s practices were obvious. Per remand by the Court, the Commission modified one provision of its remedial order, issuing a Final Order in September 2008. On February 28, 2009, the U.S. Supreme Court denied NTSP's petition for review.

The Commission challenged Flow International Corporation’s proposed $109 million acquisition of rival waterjet manufacturer OMAX Corporation. Both corporations develop, manufacture, and sell computerized waterjet cutting systems which use pressurized water mixed with abrasive garnet particles to cut various materials, including steel and stone. The proposed acquisition would have united the two largest competitors in the market for the manufacture and sale of computerized waterjet cutting systems and allowed Flow to exercise market power and increase prices. Furthermore, the Commission charged that entry would be very unlikely because OMAX received two broad patents relating to the control systems for waterjet cutting systems. The Commission approved a consent agreement requiring OMAX to grant any request for a royalty-free license for its controller patents.