The Federal Trade Commission approved a consent order addressing FTC concerns related to Tractor Supply Company’s acquisition of the rival chain Orscheln Farm and Home LLC. Tractor Supply, a Tennessee-based chain of stores that sell products for small farmers, ranchers, and landowners, proposed an acquisition of Missouri-based Orscheln, a farm store chain with over 150 stores in the Midwest and South. Under the consent order, Tractor Supply is required to divest some Orscheln stores, as well as Orscheln’s corporate offices and Missouri distribution center, to Bomgaars, an Iowa-based farm store chain, and other stores to Buchheit, another chain with farm stores in Missouri and Illinois.
The consent order requires Tractor Supply to provide assistance to Bomgaars and Buchheit as they convert the stores and transition Orscheln’s Missouri distribution center to Bomgaars. To facilitate the transition of the distribution center to Bomgaars, Tractor Supply must move the stores it is retaining out of the distribution center on a specific timeline outlined in the order. In addition to confidentiality provisions typically found in consent agreements, the order explicitly requires Tractor Supply to ensure physical separation of the teams supporting Tractor Supply’s stores, the stores being divested to Bomgaars, and the stores being divested to Buchheit, and technical separation of the data used by each team.
Tractor Supply also must obtain prior approval from the Commission before acquiring any other farm stores or any property that operated as a farm store within six months prior to the date of the proposed acquisition within 60 miles around each Orscheln store being divested. Tractor Supply must appoint a compliance officer, provide at least weekly updates on transition to a monitor appointed by the Commission and provide monthly verified compliance reports to the Commission.
The consent agreement also requires that for a period of three years, the companies buying the divested farm stores, Bomgaars and Buchheit, must obtain prior approval from the Commission before selling any of the Orscheln stores they acquired. After the initial three years, the companies must get prior approval before selling any acquired store to a person that operates a farm store within a 60-mile radius of the store to be sold.
Further details about the order, including the appointment of a monitor to oversee compliance, can be found in the analysis to aid public comment.
The Commission vote to issue the complaint and accept the proposed order for public comment was 5-0. The FTC will publish the consent agreement package in the Federal Register shortly. Instructions for filing comments appear in the published notice. Comments must be received 30 days after publication in the Federal Register. Once processed, comments will be posted on Regulations.gov.
NOTE: The Commission issues an administrative complaint when it has “reason to believe” that the law has been or is being violated, and it appears to the Commission that a proceeding is in the public interest. When the Commission issues a consent order on a final basis, it carries the force of law with respect to future actions. Each violation of such an order may result in a civil penalty of up to $46,517.