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The acting chairman of the Federal Trade Commission stated that the owner of the 7-Eleven convenience store chain buying Speedway gas stations for $21 billion may have violated competition laws.
Japanese retail giant Seven&i Holdings Agree to buy a business Marathon Petroleum owns approximately 3,900 gas stations and convenience stores. The company acquired Marathon Petroleum in an all-cash transaction last August to strengthen its position in the US market.
After acquiring part of Sunoco’s convenience store and gas station business for US$3.3 billion in 2017, the merger will expand Seven&i’s business in the United States. The addition of Speedway will also expand its share of the U.S. convenience store market from 5.9% to 8.5% with the highest share, ahead of its closest competitor, Alimentation Couche-Tard, Canada.
But in an extensive survey published on Friday, Acting FTC Chairman Rebecca Kelly Slaughter (Rebecca Kelly Slaughter) and Democratic FTC Commissioner Rohit Chopra (Rohit Chopra) stated that they were The “&i” incident felt “extremely troubled.” Although the regulator was investigating, the transaction was closed earlier in the day and said they “have reason to believe that this transaction is illegal.”
They said in a statement: “In many local markets, transactions are either merged into monopolies or reduced the number of competitors from three to two.”
They said that although the antitrust regulator has spent “a lot of resources” investigating the transaction, it has not yet reached an agreement with the company to address its concerns.
Slaughter and Chopra said: “In this case, Seven and Marathon’s decision to close is very unusual, and we are greatly troubled by this.”
7&i said on Friday that it had reached a settlement with FTC employees at the end of April and promised to divest 293 stores. The FTC commissioner has not yet signed the agreement.
The company said: “If approved, this settlement will resolve all competition issues mentioned in the commissioner’s statement.” “We hope that the committee will approve the negotiated settlement agreement in the short term.”
After the track deal is concluded Previous speech Unable to reach a consensus on pricing, the relationship between Seven&i and Marathon broke. The company was initially unwilling to pay $22 billion for the track’s business, but after five months it agreed to a small 4.5% discount.
Marathon said last year that the transaction will generate approximately $16.5 billion in after-tax income, which will be used to repay debt and return funds to shareholders.
Under pressure from activist investor Elliott Management, Marathon reached a deal. Elliott Management initiated a campaign to split the company in 2019 to address the “long-term underperformance” in its business. It has announced plans to split Speedway into a separate entity.
Marathon did not immediately respond to a request for comment on this statement.
Slaughter and Chopra said in a statement that the Federal Trade Commission will continue to investigate the transaction to “determine the appropriate way to resolve anti-competitive harm.” “The parties to the transaction bear the transaction costs themselves.”
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