FTC Wants Martin's Stores to Be Sold to 'Viable Competitor'
New York partner Dan Anziska was quoted in a March 26 Richmond Times-Dispatch article about an unknown supermarket retailer possibly entering the Richmond market by buying 19 Martin’s Food Markets stores to satisfy federal regulators who are scrutinizing a planned merger between the parent companies of Martin’s and Food Lion grocery stores. Legal experts contend that selling the stores to a viable operator is a way to preserve competition to prevent a combined entity from controlling too much market share and having the ability to raise prices.
Per Dan, the Federal Trade Commission typically won’t let a retailer close stores to satisfy the requirement of not having overlapping store locations in one market. He adds that closing stores doesn’t restore competition. “And that’s the main issue that the FTC is looking at,” he said. “Typically in a divestiture, the FTC will want a single purchaser that is viable, economically strong and has plans to put in place to keep competition. They want someone with similar kind of heft to be in the region.” Dan also said that federal regulators frown on selling stores in a market to a variety of different operators. “The FTC prefers having a strong purchaser rather than having a piecemeal sale process,” he said.