Judge rules in favor of U.S. Sugar purchase of Imperial, rejects antitrust concerns

Granulated white sugar is seen in this picture illustration. REUTERS/Emmanuel Foudrot

WASHINGTON, Sept 23 (Reuters) - A U.S. judge on Friday ruled in favor of U.S. Sugar Corp's plans to buy rival Imperial Sugar Co, rejecting a Justice Department argument that the proposed deal would drive up the price of sugar for households as well as for food and soda makers.

The Justice Department said in a lawsuit filed last November that the $315 million deal would give some 75% of refined sugar sales in the U.S. southeastto U.S. Sugar, owner and member of a cooperative with three other companies, and American Sugar Refining, which sells under the Domino brand. read more

U.S. Sugar said in a statement that it was "pleased" with the decision.

Register now for FREE unlimited access to Reuters.com

The Justice Department, which can appeal the loss, said it was reviewing its optionsand that it was "disappointed."

Judge Maryellen Noreika of the U.S. District Court for Delaware issued the opinion under seal and said a redacted version would be available.

The government, which called U.S. Sugar "the world's largest vertically-integrated cane sugar milling and refining operation," argued that the deal would lead to higher sugar prices in the southeastern United States, saying the two companies often compete to win contracts from companies that make drinks, snacks and other prepared foods.

The companies argued that sugar was easy to transport so that restricting the market to the southeast was a mistake. They also argued that Imperial is a high-priced competitor that purchases raw sugar to refine and does not compete to lower prices.

They also argued that the U.S. Department of Agriculture monitors sugar prices and can increase imports if needed to address price increases.

Register now for FREE unlimited access to Reuters.com
Reporting by Diane Bartz Editing by Bill Berkrot, Leslie Adler and David Gregorio

Our Standards: The Thomson Reuters Trust Principles.

Thomson Reuters

Focused on U.S. antitrust as well as corporate regulation and legislation, with experience involving covering war in Bosnia, elections in Mexico and Nicaragua, as well as stories from Brazil, Chile, Cuba, El Salvador, Nigeria and Peru.