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“In three of the five retail diesel markets, the proposed acquisition would result in a merger to monopoly,” the FTC said in a news release. “In the fourth, the proposed acquisition would reduce the number of significant competitors from three to two. In the fifth, the proposed acquisition would reduce the number of significant competitors from four to three.”
The FTC’s complaint alleged the acquisition in those markets would reduce competition for retail gas and diesel sales in those five markets.
“Speedway is complying with the FTC’s findings,” said Stefanie Griffith, a Marathon spokeswoman.
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“The acquisition would increase the likelihood that Marathon could unilaterally raise prices in each of the five local markets, and also would enhance the incentives for interdependent behavior in all five local markets,” the FTC said in its release.
Marathon would be required to divest its retail fuel assets to Sunoco in those markets within 90 days after the acquisition of the Express Mart stores is complete under the terms of a proposed consent order. Marathon and Express Mart would also be required to maintain competitiveness during the divestiture process, according to the FTC. The federal agency said it worked closely with the New York State Attorney General’s office on the issue.
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The agreement will be subject to public comment through Nov. 26, after which the Commission will decide whether to make the proposed consent order final.
Speedway’s footprint along the East Coast has boomed over the past few years. The retail chain operated about 1,500 stores, mostly in the Midwest, just a few years ago. But in 2015, Speedway’s $2.8 billion acquisition of Hess nearly doubled the size of the chain, adding hundreds of locations along the East Coast and South.
Marathon also recently finalized a $23.3 billion acquisition of Andeavor, a rival refining company based in Texas, adding an estimated 1,100 convenience store outlets to the Speedway’s portfolio.