FTC Moves to Block Edgewell Personal Care Buy of Harry's Inc
04 February 2020 - 2:30AM
Dow Jones News
By Chris Wack
The Federal Trade Commission said Monday it authorized the
Bureau of Competition to file suit to enjoin Edgewell Personal Care
Co.'s (EPC) proposed $1.37 billion acquisition of its key
competitor, Harry's Inc.
The FTC said its complaint alleges that the proposed combination
would eliminate one of the most important competitive forces in the
shaving industry, and the loss of Harry's as an independent
competitor would remove a critical disruptive rival that has driven
down prices and spurred innovation in an industry that was
previously dominated by two main suppliers, one of whom is the
acquirer.
The FTC has issued an administrative complaint, and has also
authorized staff to file a complaint requesting a temporary
restraining order and a preliminary injunction in the U.S. District
Court for the District of Columbia to maintain the status quo
pending a trial.
The FTC's complaint alleges that for many years, Edgewell and
Procter & Gamble (PG) operated their respective Schick and
Gillette brands of men's razors and Intuition/Hydro Silk and Venus
brands of women's razors, as a duopoly characterized by annual
price increases that weren't driven by changes in costs or
demand.
After Harry's launched in 2016, the complaint says, Procter
& Gamble and Edgewell reduced prices and developed previously
unavailable value-priced products, generating significant benefits
for consumers.
By bringing the disruptive Harry's under Edgewell's control, the
complaint alleges, the proposed acquisition would eliminate
important and growing competition among suppliers of wet shave
razors, and would inflict significant harm on consumers of razors
across the U.S.
The commission vote to issue the administrative complaint and to
authorize staff to seek a temporary restraining order and
preliminary injunction was 5-0. The administrative trial is
scheduled to begin June 30, 2020.
Edgewell Personal Care shares rose 8% to $27.93 in early
trading.
Write to Chris Wack at chris.wack@wsj.com
(END) Dow Jones Newswires
February 03, 2020 10:15 ET (15:15 GMT)
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