FEDS Sue to Stop Electrolux Deal with GE Appliances
In a shocking move, the U.S. Department of Justice filed a lawsuit yesterday seeking to prevent the 3.3 billion dollar sale of the GE Appliance business to Electrolux.
According to Chris Kenning of the Louisville Courier-Journal
“The suit argues the move could lead to price increases as the combined company dominates sales of kitchen appliances to customers like home builders, property managers, hotels and government”.
Evidently, the big appliance retailers just sighed and shed a tear, but the big guys on the contract side of purchasing appliances weren’t afraid of going up against the big guys building all the appliances. As I have written before, monopoly is a bad deal – duopoly isn’t so great either with GE/Electrolux and Whirlpool dominating the contract side of the appliance industry (and also segments of the retail appliance industry sales).
I’m sure that there is more good data coming, so I don’t want to jump the gun. However, I’ve written about how bad the airline mergers were for the flying public, and also pointed out that GE selling their appliance business to Electrolux would be a bad thing for appliance buyers. Click on the links below:
The only surprise here is that the Feds are fighting the acquisition. My guess is they’re buoyed by “encouragement” from the building industry.
Time will tell.
P.S. It looks like Electrolux thinks that disposing of the Hotpoint brand will solve the problem. I really hope that the Feds can see through this for the canard that it is.