32 Cities Unite in an Effort to Stop the Pending Sysco and US Foods Merger
WASHINGTON, D.C. - The Federal Trade Commission is now pointing to 32 cities around the country as reasons to block the merger, arguing that it would give Sysco a monopoly or near monopoly in those markets.
As we’ve previously reported, the FTC has filed a lawsuit to block the $8.2 billion Sysco/US Foods merger. The merger had been scheduled to go through in March, though Sysco and US Foods have agreed to put it on pause until it gets a ruling in the U.S. District Court case. That ruling is expected to come this summer, according to news source the Democrat & Chronicle.
According to the FTC, post-merger Sysco would have a huge market share, particularly in a number of local markets around the country. A post-merger Sysco would have 57 percent of the Rochester market share, and in most of the 31 other metro areas pointed to by the FTC, Sysco's market share could be anywhere from 69 percent in Tampa to a shocking 100 percent in San Diego.
In a statement when the FTC filed its administrative complaint in February, Debbie Feinstein, Director of the Federal Agency's Bureau of Competition, said the Sysco takeover "would eliminate significant competition in the marketplace and create a dominant national broadline food service distributor. Consumers across the country, and the businesses that serve them, benefit from the healthy competition between Sysco and US Foods, whether they eat at a restaurant, hotel, or a hospital."
A number of states have also agreed to join the FTC in its fight, according to the Democrat & Chronicle. These states include:
- Maryland
- Illinois
- Iowa
- North Carolina
- Tennessee
- Ohio
- Nebraska
- Virginia
- Minnesota
- Pennsylvania
- California
Sysco and US Foods have both called the FTC argument "ill-conceived." US Foods has said the merged company would be a more robust, efficient and effective competitor to the thousands of other food service distributors and wholesalers ... and that customers would directly benefit from the merger.
Stay tuned to AndNowUKnow as we continue to follow the Sysco and US Foods merger.
