U.S. says no settlement offer from Electrolux in GE appliance deal fight
By Diane Bartz
WASHINGTON (Reuters) - The U.S. Department of Justice, which is suing to stop Sweden's AB Electrolux from buying General Electric Co's appliance business, said on Tuesday that it had received no settlement offer from the companies that might allow the deal to go ahead.
Judge Emmet Sullivan, who is hearing the Justice Department's challenge to Electrolux's proposed acquisition - on the grounds that it would concentrate market share among too few rivals - asked at a pre-trial hearing whether there was a chance that the dispute would settle out of court.
"We fully expect to talk about a potential resolution," responded John Majoras, who represents Electrolux and who said there was "some movement" toward settlement.
A Justice Department lawyer, Ethan Glass, did not rule out an eventual settlement but said: "We haven't received any proposals so for now there is nothing to talk about."
The United States asked a federal court in July to stop Electrolux, which makes Frigidaire, Kenmore and Tappan appliances, from buying GE's appliance business for $3.3 billion.
The Justice Department argued that Electrolux and GE, along with Whirlpool Corp, make 90 percent of the stoves and ovens sold in the United States to big builders and property managers. The Department said that violates U.S. antitrust law, which is designed to stop mergers that make a market less competitive, effectively preventing the formation of unfair monopolies.
Electrolux maintains that companies such as Samsung and LG Electronics are moving into the U.S. market for appliances, diluting its market power.
The Justice Department has settled other major deal challenges recently, notably the merger of American Airlines and US Airways, and brewers Anheuser-Busch InBev and Grupo Modelo, which went ahead only after major asset sales to satisfy the Justice Department's concerns. Continued...