M&A

DoJ May Oppose Whirlpool-Maytag Merger

Possible antitrust challenge would be the government's first in two years.
Stephen TaubMarch 17, 2006

Whirlpool Corp.’s proposed $1.68 billion acquisition of Maytag Corp. could be held up due to antitrust concerns, reported Bloomberg.

The Department of Justice is mulling a court challenge, according to the wire service, because the combined company would control more than two-thirds of the U.S. market for washers and dryers and nearly half for dishwashers. Speaking on condition of anonymity, antitrust lawyers told Bloomberg that the DoJ has questioned such retailers as Lowe’s Cos. and Home Depot Inc., as well as Whirlpool’s manufacturing rivals.

“If they don’t challenge this merger, Ford and General Motors is next,” Steven M. Axinn, an antitrust lawyer not involved in the transaction, told Bloomberg. “Unless someone can argue that Maytag is going out of business, I don’t understand how the government can let this deal happen.”

A DoJ spokesman confirmed for the wire service only that “we are still looking at the proposed transaction”; spokesmen for Whirlpool and Maytag declined to comment.

According to Bloomberg, an antitrust challenge would be the government’s first in two years, following two consecutive defeats. The DoJ was unable to block Oracle Corp.’s $7.7 billion acquisition of rival software maker PeopleSoft Inc.; the Federal Trade Commission was likewise unsuccessful in stopping Arch Coal Inc.’s $364 million acquisition of Triton Coal Co.

The government may soon be called into another merger battle, too. According to Reuters, Consumers Union and the Consumer Federation of America are trying to block AT&T’s planned $67 billion acquisition of BellSouth. “If approved, this merger will lead to higher local, long distance and cell phone prices for consumers across the country,” said Gene Kimmelman, a vice president of Consumers Union, the publisher of Consumer Reports magazine. AT&T spokesman Selim Bingol told Reuters that the merger would result in “a very competitive company.”