Law, Business and Society 11th Edition by Tony McAdams

Exercise 35

Three firms controlled the $1 billion U.S. baby food market (Gerber-65 percent, Heinz-17.4 percent, and Beech- Nut-15.4 percent). Gerber was sold in over 90 percent of American supermarkets, and it had greater brand loyalty than any other product sold in the United States. Heinz was sold in 40 percent of the supermarkets and Beech-Nut in 45 percent. The baby food HHI was 4775, which would increase by 510 HHI points if Heinz and Beech-Nut were to merge. Heinz and Beech-Nut agreed to merge. The Federal Trade Commission opposed the merger.
a. What other facts would you want to know to decide the legality of this proposed merger
b. Defend the merger.
c. Decide. Explain. See Federal Trade Commission v. H. J. Heinz Co., 246 F.3d 708 (D.C. Cir. 2001).