Federal Trade Commission has Granted the Request of Furr's Supermarkets, Inc. to Delete from a 1988 Settlement

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The Federal Trade Commission has granted the request of Furr's Supermarkets, Inc. to delete from a 1988 settlement a provision requiring Furr's to obtain FTC approval, until 1998, before acquiring any supermarket assets in any of 19 designated areas in New Mexico and western Texas. In its place, the FTC has added a provision requiring Furr's to notify the Commission at least 30 days prior to acquiring any supermarkets in those areas, with certain exceptions including stores that it does not already operate as a lessee.

Furr's Supermarkets is based in Albuquerque, New Mexico. It is a successor to Rubus Development Corporation and Rubus Realty Company, which used to be known as Supermarket Development Corporation and Furr's, Inc., respectively. The 1988 settlement at issue resolved FTC charges that the acquisition of the El Paso Division of Safeway Stores, Inc. by Supermarket Development Corporation and Furr's, Inc. would substantially reduce supermarket competition in 12 towns in New Mexico and western Texas. The settlement required the respondents to divest a supermarket in each of the 12 towns, and imposed on them and their successors the prior approval requirement at issue. The 19 towns and cities to which it applies are areas where both Safeway and Supermarket Development Corporation had operated grocery stores before the challenged acquisition. They are: Albuquerque, Alamogordo, Artesia, Carlsbad, Clovis, Espanola, Hobbs, Las Cruces, Las Vegas, Lovington, Portales, Roswell, Santa Fe and Silver City, New Mexico; and El Paso, Fort Stockton, Midland, Odessa, and Pecos, Texas.

Furr's Supermarkets originally petitioned the FTC in April to reopen and modify or clarify the 1988 consent order to allow the company to acquire, without first obtaining FTC approval, any supermarkets it currently operates as a lessee in the 19 relevant areas. Furr's Supermarkets then twice amended its petition, ultimately seeking either a set-aside of the prior-approval provision or, if necessary, substitution of a prior-notice provision for the prior-approval provision, consistent with the FTC's then newly-announced Prior Approval Policy Statement. Under that policy statement, the agency said it no longer would routinely require parties to a merger it has challenged to obtain prior Commission approval for future transactions in the same market. In addition, the agency said it would presume that the public interest requires deleting prior approval provisions in existing orders (although that presumption is rebuttable). The Commission also said that it may continue to include narrow prior-approval or prior-notice provisions where there is a "credible risk" that the parties will engage in another anticompetitive transaction. (Reporters and Editors:see June 22, 1995 news release.)

In this case, the FTC said it has determined that there is a credible risk that the respondent and its successors could engage in future anticompetitive transactions that would not be reportable under the Hart-Scott-Rodino Act. Thus, the agency has substituted for the prior-approval requirement a provision requiring Furr's Supermarkets to notify the FTC at least 30 days before acquiring any supermarket that it does not already operate as a lessee in any of the 19 towns and cities listed above, with certain exemptions.

The FTC also announced today that it has granted Furr's Supermarkets' original request to modify the order to exempt from the prior-notice requirement the firm's acquisition of fee simple interests in real estate in which it currently operates a retail grocery store as a lessee. Furr's Supermarkets 'change in status from a leaseholder to a fee owner in any one or more of these stores would have no practical effect on competition in the relevant markets,' so prior notice of these transactions is unnecessary, the Commission said.

The Commission vote to modify the 1988 consent order was 5-0.

Copies of the Commission order reopening and modifying the 1988 consent order and other documents associated with this case 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-3224)