The Penn Traffic Company

The Federal Trade Commission has given final approval to a consent agreement with The Penn Traffic Company, settling charges that its plan to acquire 45 grocery stores in Pennsylvania and New York from the American Stores Company subsidiary, Acme Mar- kets, Inc., would violate antitrust laws. The Commission's action makes the consent order provisions binding on the respondent.

Penn Traffic, one of the leading operators of supermarkets in the eastern United States, is based in Syracuse, New York. It operates stores under the trade names Riverside Markets, Bi-Lo Foods and Big Bear, among others. American Stores is based in Salt Lake City, Utah. Its Acme subsidiary is based in Malvern, Pennsylvania, and operates supermarkets in Pennsylvania, New York, New Jersey, Maryland, and Delaware.

The FTC had alleged in the case that the acquisition would substantially reduce supermarket competition in three markets where Penn Traffic and American compete--they are defined as the areas surrounding Towanda, Mount Carmel, and Pittston, Pennsylvania.

Under the final order, Penn Traffic must divest the Acme supermarkets in Towanda and Pittston, and either the Acme super- market or its own supermarket in Mount Carmel, to a Commission- approved acquirer or acquirers within 12 months. Pending dives- titure, Penn Traffic must keep the stores marketable and viable, to help ensure that the divestitures remedy the alleged compe- titive concerns. If the divestitures are not completed on time, the settlement permits the FTC to appoint a trustee to complete them.

In addition, the settlement requires Penn Traffic, for 10 years, to obtain Commission approval before acquiring an interest in any entity that owns or operates a supermarket in any of the three areas at issue.

The consent agreement was announced for a public-comment period on Jan. 19, 1995. The Commission vote to issue it in final form occurred on May 15, and was 5-0.

NOTE: A consent agreement is for settlement purposes only and does not constitute admission of a law violation. When the Commission issues a consent order on a final basis, it carries the force of law with respect to future actions by the respon- dents. Each violation of such an order may result in a civil penalty of up to $10,000.

A news release summarizing the complaint and consent agree- ment was issued at the time the Commission accepted the consent agreement for public comment. Copies of that release and of the complaint and final order are available from the FTC's Public Reference Branch, Room 130, 6th Street and Pennsylvania Avenue, N.W., Washington, D.C. 20580.

(FTC File No. 951 0009)

(Docket No. C-3577)