U.S. Sugar introduced earlier this yr it reached an settlement to amass the Imperial Sugar Firm, one of many largest sugar refiners within the nation.
WASHINGTON — The Justice Division filed a lawsuit on Tuesday looking for to dam a significant U.S. sugar producer from buying its rival, arguing that permitting the deal would hurt competitors and shoppers.
The swimsuit was filed in federal courtroom in Delaware. It comes about eight months after U.S. Sugar introduced it reached an settlement to amass the Imperial Sugar Firm, one of many largest sugar refiners within the nation.
The lawsuit is the newest instance of the Justice Division’s strategy to aggressive enforcement of federal antitrust legislation that officers say is aimed toward guaranteeing a good and aggressive market. It comes months after President Joe Biden signed an govt order that referred to as on the Justice Division and Federal Commerce Fee to vigorously implement antitrust statutes and promote market competitors.
“Sturdy antitrust enforcement is a vital pillar of the Justice Division’s dedication to making sure financial alternative and equity for all,” Lawyer Normal Merrick Garland mentioned in a press release. “We is not going to hesitate to problem anticompetitive mergers that may hurt American shoppers and companies alike.”
U.S. Sugar mentioned it plans to struggle the lawsuit. It argued that the acquisition will improve manufacturing and distribution of refined sugar and supply a safer provide.
“This transaction will enhance provide chain logistics and won’t end in increased costs or any hurt to clients and shoppers,” the corporate mentioned in a press release. “We sit up for making our case in courtroom.”
The Justice Division disagreed. It says the proposed acquisition would “additional consolidate an already concentrated marketplace for refined sugar.” It will reduce down on competitors, leaving solely the brand new consolidated firm and one different main sugar firm promoting a major share of refined sugar within the southeastern U.S., the Justice Division contends.
The Justice Division says U.S. Sugar, which operates a big refinery in Florida, sells all of its sugar by means of a advertising and marketing cooperative often known as the United Sugars Company. Imperial Sugar operates a refinery in Savannah, Georgia and a sugar switch and liquidation facility in Ludlow, Kentucky.
Assistant Lawyer Normal Jonathan Kanter, who leads the Justice Division’s antitrust division, mentioned the businesses have been “looking for to additional consolidate an already cozy sugar business.”
“Their merger would eradicate aggressive competitors within the provide of refined sugar that results in decrease costs, higher high quality, and extra dependable service,” he mentioned.
The businesses introduced the acquisition in March, saying that it might return Imperial Sugar to all-American possession. Imperial Sugar is a subsidiary of Louis Dreyfus Firm, which is headquartered within the Netherlands. The Justice Division says Imperial Sugar’s revenues have been over $700 million in 2020.
When the acquisition was introduced, the businesses mentioned it might assist develop manufacturing and cut back manufacturing prices and would improve the safety of the U.S. sugar provide. The businesses additionally mentioned a brand new mixed firm would provide higher competitors and develop distribution within the U.S.
Representatives for Imperial Sugar didn’t instantly reply to requests for remark.