The agreed $2.8 billion (€2.55bn; £1.75bn) merger of ice cream giants Swiss-owned Nestlé Holdings and Dreyer’s Grand is set for permanent stowage in the deepfreeze by America’s Federal Trade Commission, according to a statement issued by the regulatory body Tuesday night.
The merger, announced last June, would have created the largest icecream corporation in North America, controlling some sixty percent of all icecream sales in the region. The espoused twosome, conscious of antitrust issues, offered to dispose of some of their brands, numbered among which are Haägen Dazs, Godiva, Starbucks Nestle, Dreyer’s and Edy’s.
The FTC was not impressed by the proposed sell-off. “This merger as structured would likely raise prices and reduce choice for consumers,” opined Joe Simons, director of the FTC’s bureau of competition. “The market for super premium ice cream is highly concentrated and this deal will reduce the number of significant competitors from three to two.” The third party referred to is Unilever’s Ben & Jerry’s brand
The two companies’ combined sales in 2001 reached $2.2 billion. Neither was willing to comment on the FTC’s move.
Data sourced from: AdAge.com; additional content by WARC staff