On July 30, 2008, the Federal Trade Commission (“FTC”) entered into a settlement agreement that allows McCormick & Company Inc.’s (“McCormick”) proposed $605 million acquisition of Lawry’s and Adolph’s brands of seasoned salt products from Unilever N.V. (“Unilever”) to proceed.
According to the FTC’s complaint, McCormick’s Season-All brand competes with Lawry’s brands in the manufacture and sale of branded seasoned salt products in the United States. The complaint indicates that these companies have strong brand followings and that even a five to ten percent increase in prices would not cause consumers to switch brands. As a result of the proposed transaction, the FTC believes that McCormick will control 80% of the market for branded seasoned salts and the company would have the ability to unilaterally increase prices on either brand to the detriment of consumers.
McCormick agreed to divest its interests in its Season-All brand business to Morton, a FTC approved buyer, within ten days of the acquisition. The Season-All brand includes Season-All seasoned salt, Garlic Season-All seasoned salt, Pepper Season-All seasoned salt, Spicy Season-All seasoned salt, 25% Less Sodium Season-All seasoned salt, and Season-All coating mix. The consent order also calls for the appointment of a trustee to oversee the divestiture and prevent McCormick from buying another seasoned salt product or interests in any spice blends business without notifying the FTC for the next 10 years. The company is still allowed to expand its line of spices.