The American competition gendarme, the FTC, has initiated proceedings against the merger of the specialist in electronic cigarettes Juul et Altria, owner of the Marlboro brand, believing that it had damaged the competition.
La Federal Trade Commission (FTC), initiated proceedings against the merger of the specialist in electronic cigarettes Juul et Altria, owner of the Marlboro brand, believing that it had damaged the competition.
« For several years, Altria and Juul competed in the fairly closed e-cigarette market" , has recalled Ian conner, head of competition services at the FTC, in a statement released Wednesday.
The two groups kept a close watch on their respective prices and innovations. Altria took advantage of its status as an established player in the tobacco market to negotiate space on the shelves of retailers, which did not prevent Juul from becoming the leader in the e-cigarette market in the United States.
Seeing himself overwhelmed, Altria then, at the end of 2018, “ orchestrated its exit from the e-cigarette market before becoming the largest investor in Juul“, Underlined Mr. Conner.
Altria actually invested $ 12,8 billion in exchange for a 35% stake in Juul in December 2018, valuing the young company at $ 38 billion. Facing costly legal disputes, Juul has since seen its value melt away and is now estimated at $ 12 billion.
Altria had also initially committed not to compete with Juul's products for at least six years and to provide them with expertise in specific areas, such as lobbying health authorities.
« From competitors, the two groups became collaborators by eliminating competition and sharing the profits of Juul“, Accused Mr. Conner.
These conditions constitute obstacles to competition, according to the FTC, which plans to hold a hearing on the subject in January 2021. The authority would like Altria to get rid of its investment.
In a statement, the tobacco group says it wants " vigorously defend »Its stake.
« We believe our investment in Juul is not detrimental to competition and that the FTC has misconstrued the facts" , has indicated Murray Garnick, group legal manager, cited in the document.
source : AFP / Exchange area