United States Foods and Sysco merger challenged
The federal trade commission has challenged the on-going merger that is to take place between Sysco and US Foods. Herbert Slatery, the Attorney General of Tennessee with attorney generals from ten other states has also united in their challenge against the merger between US Foods and Sysco.
The group of attorney generals and the federal trade commission has requested for an order to temporarily stop the merger between US Foods and Sysco. They have even set up a preliminary injunction to restrain the merger proposal.
At the moment the federal trade commission are having an administrative proceeding about the merger. And they are saying that this merger would not be in adherence to the antitrust laws because it will bring about a considerable reduction in competition all over the United States for services of food distribution. This will also affect local markets in about thirty two states.
The fear of a hike in the prices of food service across the nation, in relation to customers like schools, restaurants, hotels and hospital forms the basis for the refused merger proposal between US Foods and Sysco.
Sysco and US Foods are the biggest food distribution service all over the United States, and a merger between this two will monopolize the food service distribution, hence causing an increase to the price of food service distribution.