Premerger clearance denied: l\ferger of firms in same industry would raise questions

No. 188. Premerger clearance denied: l\ferger of firms in same industry would raise questions.

The. Commission issued advisory opinions on September 27. 1962, ::\1nrc11 28, 1068, and September 12. J f)();\ in ,..,.hich C'ommuhwl request8 for premerger clearance from liability under Section 7, amended Clavton Act. bv a small dair~; in financial difficulty "ere denied as to acquisition by a. larger company in the same industry. but ",erefinaJly approved permitting acquisition by diversified corporation in another industry.

small c1air~c in financial difficulty desiring to be acquired by a larger company in the same field applied for clearance of the proposed acquisit.ion. The la rger compallY~ an int8~2'rated processor and distl'ibutOI' of dairy liroc1llcts, "'as the re~ponclE'nt in n. complaint in litigation ,,-ith the Commission, The applicant ~.Yas advised the proposed acquisition "ould raise questions similar to those involved in the proceeding: and that the pendency of the proct'edings made it inappropriate to express any further views. Be.consideration was requested. In response, the Commission informed the fl pplicnnt of the decision in the Foremost Dairies case. Docket 640;') and again ach-isecl that the flcquisition would raise sprions questions under Section 7 of the Clayton Act. Further. the Commission pointed out that it recognized the problems of small dairies and suggested further efforts to sell to a local or regional purchaser. Later, the smfll1 dairy requested consideration of its proposed acquisition by a large. diversified corporation in the food industry. The Commission advised it ",oulc1 contemplate no action if the transaction ',flS consmnmated. The Commission added its nell-ice should not construed as affecting any position it hac) previously taken against the acquiring corporation nor as in an~' 'yay prejudicing nn~. pending 01' future action it might take against the acquiring corporation regarding other acquisitions. (File Xo. 633 7016. released Feb. 13 , 1968.