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U.S. Justice Department files lawsuit to stop sugar merger

WASHINGTON, Nov 23 (Reuters) – The U.S. Justice Department stated on Tuesday it has filed an antitrust lawsuit aimed toward blocking U.S. Sugar Corp from shopping for rival Imperial Sugar Co (LOUDRI.UL), a deal the federal government stated might drive up the value of sugar for households in addition to food and drinks makers.

The deal, if it goes ahead, would imply that U.S. Sugar, proprietor and member of a cooperative with three different corporations, and one other firm would have some 75% of refined sugar gross sales within the U.S. Southeast, the division stated.

“U.S. Sugar and Imperial Sugar are already multibillion-dollar corporations and are seeking to further consolidate an already cozy sugar industry,” stated Jonathan Kanter, the brand new head of the Justice Department’s Antitrust Division.

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The two corporations typically compete head-to-head to win buyer contracts, the federal government stated in its 27-page grievance.

U.S. Sugar, nonetheless, stated the deal would shield American jobs.

“We disagree with the Justice Department’s decision and fully intend to litigate this matter,” the corporate stated in a press release. “This transaction will improve supply chain logistics and will not result in higher prices or any harm to customers and consumers. We look forward to making our case in court.”

The different main sugar refiner within the area is American Sugar Refining, which sells below the “Domino” model, the division stated.

U.S. Sugar introduced in March that it will purchase Imperial Sugar from commodities dealer Louis Dreyfus Co. The deal is price about $315 million, the Justice Department stated.

Imperial Sugar operates a refinery at Port Wentworth in Savannah, Georgia, and a sugar switch and liquification facility in Ludlow, Kentucky. It was purchased by Louis Dreyfus in 2012 for $78 million.

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Reporting by Diane Bartz in Washington
Editing by Mark Porter and Matthew Lewis

REUTERS/Andrew Kelly

An American flag waves outside the U.S. Department of Justice Building in Washington, U.S., December 2, 2020. REUTERS/Tom Brenner

REUTERS/Joe Skipper

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