Antitrust regulators on Wednesday approved Whirlpool Corp.’s proposed $1.79 billion purchase of Maytag Corp., saying the merger would not reduce competition substantially.
The existence of strong rivals and the cost savings the new company would generate indicate “this transaction is not likely to harm consumer welfare,” the Justice Department said.
An investigation by the department’s Antitrust Division found that an effort by the new company to raise prices on its washers and dryers “likely would be unsuccessful” because at least five other companies are well-established in U.S. markets.
Those competitors include the Sears brand Kenmore, General Electric and Frigidaire. The Justice Department also concluded that LG and Samsung and other foreign manufacturers have quickly established themselves in recent years.
“LG, Samsung and other foreign manufacturers could increase their imports to the U.S.,” the department said in a statement. “Existing U.S. manufacturers have excess capacity and could increase their production.”
The government also concluded that large retailers including Sears, Lowe’s, The Home Depot and Best Buy have alternatives available to help them resist any attempt by the combined company to raise prices.
The cost savings and other efficiencies gained by the merger should also benefit consumers, the department said.
The companies had agreed not to close the transaction before Thursday.
Read the full story at The WCF Courier