The Federal Trade Commission has ruled that Tops Markets to sell two stores in Ithaca in order to "protect consumers from the potential anticompetitive effects of Tops’ recent acquisition of the bankrupt Penn Traffic Company supermarket chain," known locally as P&C Foods, according to a press release. The Ithaca stores expected to be affected are at East Hill Plaza and Triphammer Road.
However, the decision is open to public comment until September 7, 2010, after which the Commission will decide whether to make it final. Comments should be sent to: FTC, Office of the Secretary, 600 Pennsylvania Avenue, N.W., Washington, DC 20580. To submit a comment electronically, use this address: https://ftcpublic.commentworks.com/ftc/penntraffic/.
According to the press release:
In November 2009, Penn Traffic filed for bankruptcy and, subsequently, Tops bought all of Penn Traffic’s 79 supermarkets in the northeast for approximately $85 million. The acquisition raised competition issues in several areas of New York and Pennsylvania.
"Through its investigation, the FTC staff found five local areas where competition was an issue: Bath, Cortland, Ithaca, and Lockport, New York; and Sayre, Pennsylvania. In these markets, absent a remedy, staff found that Tops’ acquisition of Penn Traffic would be anticompetitive and likely would lead to higher grocery prices for consumers. In each market there are no more than three supermarkets within a 10- to 15-mile area. Consistent with past investigations, staff concluded that other chains such as Aldi’s, buying clubs, and other food stores would not constrain prices after the merger was completed.
"Further, in many of these geographic areas, staff found that new competitors were unlikely to enter the market quickly enough to prevent the acquisition’s anticompetitive effects. And, in those markets where entry might occur in the future, staff found that despite the new competition, the markets would still be highly concentrated and the transaction, therefore, anticompetitive.
"The settlement order announced today requires Tops to sell seven Penn Traffic supermarkets to an FTC-approved buyer within three months." (in Bath, Cortland, Ithaca (two stores), and Lockport, New York; and Sayre, Pennsylvania (two stores)
However, the decision is open to public comment until September 7, 2010, after which the Commission will decide whether to make it final. Comments should be sent to: FTC, Office of the Secretary, 600 Pennsylvania Avenue, N.W., Washington, DC 20580. To submit a comment electronically, use this address: https://ftcpublic.commentworks.com/ftc/penntraffic/.
According to the press release:
In November 2009, Penn Traffic filed for bankruptcy and, subsequently, Tops bought all of Penn Traffic’s 79 supermarkets in the northeast for approximately $85 million. The acquisition raised competition issues in several areas of New York and Pennsylvania.
"Through its investigation, the FTC staff found five local areas where competition was an issue: Bath, Cortland, Ithaca, and Lockport, New York; and Sayre, Pennsylvania. In these markets, absent a remedy, staff found that Tops’ acquisition of Penn Traffic would be anticompetitive and likely would lead to higher grocery prices for consumers. In each market there are no more than three supermarkets within a 10- to 15-mile area. Consistent with past investigations, staff concluded that other chains such as Aldi’s, buying clubs, and other food stores would not constrain prices after the merger was completed.
"Further, in many of these geographic areas, staff found that new competitors were unlikely to enter the market quickly enough to prevent the acquisition’s anticompetitive effects. And, in those markets where entry might occur in the future, staff found that despite the new competition, the markets would still be highly concentrated and the transaction, therefore, anticompetitive.
"The settlement order announced today requires Tops to sell seven Penn Traffic supermarkets to an FTC-approved buyer within three months." (in Bath, Cortland, Ithaca (two stores), and Lockport, New York; and Sayre, Pennsylvania (two stores)
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