Retail fuel station and convenience store operator Alimentation Couche-Tard Inc. has agreed to divest three fuel stations in Alabama to settle Federal Trade Commission charges that ACT’s proposed acquisition of Jet-Pep, Inc. would violate federal antitrust law.
The FTC’s settlement with ACT preserves competition in Brewton, Monroeville, and Valley, Alabama by requiring the company to divest a retail fuel station in each of those locales.
Without the divestitures, the FTC alleged, the acquisition would likely substantially lessen competition and lead to higher prices in these local markets.
Under the terms of the acquisition, ACT will acquire ownership or operation of 120 Jet-Pep fuel outlets with convenience stores – 18 via Circle K, a wholly-owned subsidiary of ACT, and 102 via CrossAmerica Partners LP, over which Circle K has operational control and management.
ACT agreed to another package of divestitures earlier this year to settle FTC charges in connection with a different merger.
Retail fuel markets are frequently small and highly localized. The complaint alleges that without a remedy, ACT’s acquisition of Jet-Pep Inc. would reduce the number of independent market participants in each of these three local markets to three or fewer.
According to the complaint, the acquisition would increase both the likelihood of successful coordination among the remaining firms and the likelihood that ACT will unilaterally exercise market power.
Under the terms of the consent agreement, ACT is required to identify a buyer or buyers that are acceptable to the Commission within 120 days after the transaction closes, and to divest the three retail fuel stations.
The agreement also requires ACT to maintain the economic viability, marketability, and competitiveness of each station until the divestiture is complete.
Further details about the consent agreement, which includes an asset maintenance order and allows the Commission to appoint a monitor, are set forth in the analysis to aid public comment for this matter.
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