US Justice Dept. Sues To Halt Sugar Company Merger, Citing Concern Over Market Competition

Faizan Hashmi Published November 23, 2021 | 10:59 PM

The US Justice Department said on Tuesday it is suing in a district court to block the acquisition of Imperial Sugar Company by the rival United States Sugar Corporation

WASHINGTON (UrduPoint News / Sputnik - 23rd November, 2021) The US Justice Department said on Tuesday it is suing in a district court to block the acquisition of Imperial Sugar Company by the rival United States Sugar Corporation.

"The Department of Justice filed a civil antitrust lawsuit today to stop United States Sugar Corporation (U.S. Sugar) from acquiring its rival, Imperial Sugar Company (Imperial Sugar). The complaint, filed in the U.S. District Court for the District of Delaware, alleges that the transaction would leave an overwhelming majority of refined sugar sales across the Southeast in the hands of only two producers. As a result, American businesses and consumers would pay more for refined sugar, a significant input for many foods and beverages," the Justice Department said in a press release.

US Attorney General Merrick Garland is quoted as saying in the statement that the Justice Department will not hesitate to "challenge anticompetitive mergers" that harm American consumers and businesses.

The Justice Department's complaint alleges that US Sugar and Imperial Sugar compete head-to-head in the southeastern US market, both having sugar refineries based in the region. That competition has resulted in lower prices, better-quality products and more reliable service for customers in the area, the Justice Department said.

US Sugar sells its product through the United Sugars Corporation - a marketing cooperative owned by US Sugar and three other refined sugar producers. The company currently competes only with Imperial Sugar and American Sugar Refining, better known by its "Domino" brand name, in the region.

The merger would leave only United Sugar and Domino to control the vast majority of refined sugar sales in the southeastern US, the Justice Department said. This would enhance the likelihood that the two companies coordinate with each other and refrain from competing aggressively, the Justice Department added.