PUBLIC VERSION 

FEDERAl TRADE COHMlSSIOI~ 

UNITED STATES OF AMERICA,.hLL '·S 

BEFORE FEDERAL T~ ff&\4mS'~stoN'+ 

In the Matter of 

Service Corporation International, 

a corporation, and 

Stewart Enterprises, Inc., 

a corporation 

OOCUl1ENT PROCESSING SECTION 

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Docket No. C-4423 

File No. 131 0163 

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PETITION FOR APPROVAL OF PROPOSED DIVESTITURE 

Pursuant to Section 2.4l(f) of the Federal Trade Commission 

("Commission") Rules of Practice and Procedure, 16 C.F.R. § 2.41(f) (2012), and 

Paragraphs II.A. of the Decision and Order contained in the Agreement Containing Consent 

Orders accepted for public comment in this matter ("Decision and Order"), Respondent 

Service Corporation International ("SCI") hereby petitions the Commission to approve the 

divestiture to Angeleno Mortuaries, Inc. ("Angeleno") of the. following two Divestiture 

Businesses: (i) Halley-Olsen-Murphy Funerals & Cremations, 44831 N. Cedar Avenue, 

Lancaster, California 93534 and (ii) Antelope Valley Cremation Service, 619 West Milling, 

Lancaster, California 93534.1 SCI additionally petitions the Commission to approve the 

Facilities Agreement between Angeleno and S.E. Funeral Homes of California, Inc.2 dated 

February 24, 2014. 

1 Halley-Olsen Murphy Funerals & Cremations and Antelope Valley Cremation SeiVice are located in the 

same building, but have separate addresses as required by California law. 2 S.E. Funeral Homes of California, Inc. is a wholly-owned subsidiary of SCI. 
PUBLIC VERSION 

The Divestiture Businesses associated with these facilities (as defined in the 

Decision and Order, and hereinafter collectively referred to as the "Lancaster Divestiture 

Assets") will be sold to Angeleno pursuant to the Asset Sale Agreement (the "ASA") dated 

February 24, 2014, by and among Angeleno and S.E. Funeral Homes of California, Inc. 

Background 

On December 23, 2013, SCI and Respondent Stewart Enterprises, Inc. 

("Stewart") (collectively, the "Respondents") executed an Agreement Containing Consent 

Orders that included the Decision and Order and Order to Hold Separate and Maintain 

Assets (collectively, the "Consent Agreement") to settle the Commission's charges that the 

proposed acquisition by SCI of Stewart would violate Section 5 of the Federal Trade 

Commission Act, as amended, 15 U.S.C. § 45, and Section 7 of the Clayton Act, as 

amended, 15 U.S.C. § 18. On December 23, 2013, the Commission accepted the Consent 

Agreement for public comment, and on December 23, 2013, SCI consummated its 

acquisition of Stewart. Stewart is now a wholly owned subsidiary of SCI. The Consent 

Agreement is presently before the Commission for final approval and issuance of the orders 

contained therein. 

Because this petition and its attachments contain confidential and 

competitively sensitive business information relating to the divestiture of the Lancaster 

Divestiture Assets-the disclosure of which may prejudice Respondents and Angeleno 

Mortuaries, Inc., cause harm to the ongoing competitiveness of the Lancaster Divestiture 

Assets, and impair Respondents' ability to comply with their obligations under the Consent 

Agreement-Respondents have redacted such confidential information from the public 

version of this petition and its attachments. Pursuant to Sections 2.41(f)(4) and 4.9(c) of 
PUBLIC VERSION 

the Commission's Rules of Practice and Procedure, 16 C.F.R. § 2.41(f)(4) & 4.9(c) (2012), 

Respondents request that the confidential version of this petition and its attachments and 

the information contained herein be accorded confidential treatment. The confidential 

version of this petition should be accorded such confidential treatment under 5 U.S.C. § 

552 and Section 4.10(a)(2) ofthe Commission's Rules ofPractice and Procedure, 16 C.F.R. 

§ 4.10(a)(2) (2012). The confidential version of this petition is also exempt from 

disclosure under Exemptions 4, 7(A), 7(B), and 7(C) of the Freedom of Information Act, 5 

U.S.C. §§ 552(b)(4), 552(b)(7)(A), 552(b)(7)(B), & 552(b)(7)(C), and the Hart-ScottRodino Antitrust Improvements Act of 1976, as amended, 15 U.S.C. § 18a(h). 

Respondent SCI desires to complete the proposed divestiture of the Lancaster 

Divestiture Assets as soon as possible, following Commission approval thereof. All 

conditions other than Commission approval and those customarily satisfied at closing have 

· already been satisfied, so that SCI and Angeleno are in a position to close the divestiture 

within a few days of such approval. Prompt consummation will further the purposes of the 

Decision and Order and is in the interests of the public, Angeleno, and Respondents, 

because it will allow Angeleno to move forward with its business plans for the competitive 

operation of the Lancaster Divestiture Assets. SCI accordingly requests that the 

Commission promptly commence the period of public comment pursuant to Section 

2.41 (t)(2) of the Commission's Rules of Practice and Procedure, 16 C.F .R. § 2.41 (t)(2) 

(2012), limit the public comment period to the customary 30-day period, and grant this 

petition by approving the divestiture of the Lancaster Divestiture Assets to Angeleno 

pursuant to the above-referenced ASA as soon as practicable after the close of the public 

comment period. 
PUBLIC VERSION 

I. The Asset Sale Agreement Is Final and Consistent with the Decision and Order's 

Terms 

Paragraph II.A of the Decision and Order requires Respondents to divest the 

Divestiture Businesses (as defmed in the Decision and Order) within 180 days of the date on 

which the Order is issued.3 Pursuant to this requirement, SCI diligently has sought a buyer that 

would be acceptable to the Commission, through an extensive auction process that produced 

great interest in the property. As noted above, on February 24,2014, SCI entered into the ASA 

with Angeleno. The ASA requires SCI to sell the Lancaster Divestiture Assets to Angeleno. 

The executed ASA is attached hereto as Confidential Exhibit A. 

The ASA with Angeleno complies with the requirements of Paragraph II of the 

Decision and Order: 

A. Paragraph II.A requires that Respondents divest the Lancaster Divestiture 

Assets, absolutely and in good faith. Pursuant to the ASA, Angeleno Mortuaries, Inc. will 

acquire the Lancaster Divestiture Assets. See ASA § 1.1 . 

B. Paragraph II.B.l requires that Respondents divest (i) Halley-OlsenMurphy Funerals and Cremations (Halley-Olsen-Murphy), and (ii) Antelope Valley Cremation 

Service in Lancaster, California, to no more than one Acquirer. The ASA contemplates that 

Angeleno will acquire both Halley-Olsen-Murphy and Antelope Valley Cremation Service in 

Lancaster, California, satisfying this requirement. See ASA § 1.1. 

* * * 

As demonstrated above and in the accompanying ASA, SCI has entered into an 

agreement relating to the divestiture of the Lancaster Divestiture Assets that fully complies with 

3 The Commission has not yet issued the Order as final. 
PUBLIC VERSION 

the Commission's Decision and Order with respect to the divestiture of these assets. 

Accordingly, Respondents hereby seek Commission approval of the proposed divestitures 

pursuant to Paragraph II.A of the Decision and Order. 

II. The Prospective Acquirer Will Be a Strong and Effective Competitor 

A. Background 

Angeleno has extensive experience in the deathcare industry, has the financial 

wherewithal to make this acquisition, and will ensure that Halley-Olsen-Murphy and Antelope 

Valley Cremation Service remain strong and effective competitors in Lancaster, California. 

Williams Hawkins founded Angeleno in 1997 in North Hollywood, California. 

Angeleno has grown both organically and through acquisition. Two Angeleno facilitiesAngeleno Valley Mortuary (1997) and Angeleno Mortuary, Van Nuys (2004)--were founded 

from scratch and have grown to jointly serve over • calls in 2013. In 2011, while still 

maintaining a major focus on organic growth, Angeleno began a strategy of growth via 

acquisition. Angeleno acquired Lorenzen Mortuary in Reseda, California, in 2011 and acquired 

Reardon Simi Valley Funeral Home in Simi Valley, California, Ingold Funeral Chapel in 

Fontana, California, and Crawford Mortuary in Northridge, California, in 2013. The six facilities 

that comprise Angeleno Mortuaries served .. calls in 2013. 

Angeleno operates as a privately held inter-generational family business with each 

of the six locations being run as individual businesses with DBAs under the same main Federal 

Tax ID. The company has 37 employees and expects to serve over .. families in 2014 

through its six currently-owned facilities. 

Angeleno's corporate structure is designed so that each business can operate both 

independently and with strong inter-dependence that allows for flexibility with 
PUBLIC VERSION 

personnel/vehicles/facilities, branding, and economies of scale relative to cost of goods sold, 

preparation, storage, and other operating expenses. 

Angeleno enjoys a strong reputation in the community as well as with industry 

organizations. Angeleno founder, William Hawkins, is a past president of the Los Angeles 

County Funeral Directors Association (LACFDA) and former board member of the California 

Funeral Directors Association (CFDA). Mr. Hawkins and Angeleno have a solid history with 

regulators and no pending regulatory issues. 

As discussed in more detail below, Angeleno owns no competitive assets in 

Lancaster, California. The geographically closest asset to the to-be-acquired Lancaster 

Divestiture Assets to Angeleno's currently owned facilities is approximately 50 miles away in 

the San Fernando Valley. 

B. Financial Capability 

To acquire the Lancaster Divestiture Assets, Angeleno is obtaining a loan that 

will be financed by has provided 

over $60,000,000 of funding for various funeral home acquisitions industry-wide, with 

- to Angeleno for the acquisitions of Reardon Simi Valley Funeral Home and 

Crawford Mortuary combined in 2013. 

Angeleno's founder, William Hawkins, has 

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PUBLIC VERSION 

Mr. Hawkins has a strong documented history of successfully operating 

businesses of similar sizes (including after acquisition). From the time of its founding until 

2013, Angeleno Valley Mortuary in North Hollywood has grown to serve. calls in 2013. 

Additionally, Angeleno Mortuary in Van Nuys was founded in 2004 and has grown to serve. 

calls in 2013. 

Despite the highly competitive landscape in the San Fernando Valley, Angeleno's 

three facilities that were in existence prior to the 2013 acquisitions-Angeleno Valley Mortuary 

in North Hollywood, Angeleno Mortuary in Van Nuys, and Lorenzen Angeleno in Reseda-had 

-call volume growth- between 2012 and 2013. This organic growth was seen 

across the board as all three locations individually experienced an increase in call volume. 

The ability to grow an acquired business is shown by Angeleno's 2011 acquisition 

of Lorenzen Angeleno Mortuary from Lorenzen Mortuary. This acquisition involved an outpost 

facility of Lorenzen Mortuary. Since the acquisition in 2011, Lorenzen Angeleno Mortuary has 

had higher case volume and revenue than it had in the few years prior to the sale. In 2011, 

Lorenzen Angeleno Mortuary had. calls, but by 2013 this call volume had increased to •. 

The three businesses that Angeleno acquired in 2013 have all grown in business 

call volume since the time of their acquisition. At each of these three businesses, Angeleno 

retained all full time employees, invested significant operating profit into building, furniture, and 

fixture enhancements, and hired additional staff. 

Angeleno similarly plans to enhance and improve both of the Lancaster 

Divestiture Assets to make them even stronger competitors post-divestiture. Specifically, 

Angeleno intends to spend approximately - on building a new preparation room at 

Halley-Olsen-Murphy in Lancaster. The facility does not have its own preparation room and has 
PUBLIC VERSION 

been using another facility under common ownership until this time. Plans to build this 

preparation room are well underway. Mr. Hawkins has met multiple times with representatives 

of Flewelling & Moody (architectural firm) and Ashford Construction Company (builder), both 

of whom were involved in the 2013 construction of the Halley-Olsen-Murphy facility in 

Lancaster. Although formal engagement of these firms is pending FTC approval of this petition 

and closing of the purchase from SCI, both firms have committed to Angeleno to handle the 

project. Angeleno will promptly begin construction of a preparation room as soon as feasible. 

Angeleno has also engaged Duncan Stewart, an expert in preparation room design, to assist in 

the technical aspects of the preparation room design such as OSHA requirements and fixtures. 

Duncan Stewart is a well-known technical design firm in this industry and has been retained by 

several other death care industry firms, including SCI, Stewart Enterprises, and Angeleno. 

Angeleno has already begun to verify building and other specifications for the preparation room. 

Specifically, Angeleno has verified the locations of the building's firewalls and ensured that they 

will not need to be relocated to complete the preparation room. Angeleno has also verified the 

water and sewer access and plumbing for the to-be-developed room. Angeleno does not 

anticipate any significant issues in the development of the preparation room at Halley-OlsenMurphy. 

For a short period oftime, not to exceed six months, while the preparation room is 

being built, Angeleno will obtain Transitional Services in the form of access to an SCI 

preparation room. These Transition Services will be provided pursuant to the Facilities 

Agreement between Angeleno and S.E. Funeral Homes of California, Inc. Respondents petition 

the Commission for approval of this Facilities Agreement, pursuant to Part II.F of the Decision 

& Order. A copy of the Facilities Agreement is enclosed as Confidential Exhibit B. Angeleno is 
PUBLIC VERSION 

not required to purchase any minimum amount of preparation services under the agreement and 

may cease use of these services at any time, including upon completion of the preparation room 

at Halley-Olsen-Murphy. Nothing in this Facilities Agreement prevents Angeleno from utilizing 

its own existing preparation rooms located at the site of its currently-owned facilities in the San 

Fernando Valley. 

Angeleno also plans to grow the Antelope Valley Cremation Services business. 

As the Commission is aware, Antelope Valley Cremation Services currently operates as an 

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independent direct cremation business from Halley-Olsen-Murphy, but is physically located 

within the Halley-Olsen-Murphy funeral home building. Angeleno believes that this business 

can be more effectively operated, marketed, promoted and can better serve consumers from its 

own, separate location. To this end, Angeleno intends to move the Antelope Valley Cremation 

Services business to a storefront location directly across the street from Halley-Olsen-Murphy. 

In doing so, Angeleno intends to invest in Antelope Valley Cremation as an independent 

business by, among other improvements, adding an additional full-time employee. 

C. Operations Experience 

Angeleno has sufficient operating expertise to not only ensure the continued 

competitiveness of the Lancaster Divestiture Assel.s, but to enhance them. 

Angeleno's founder, William Hawkins, was first employed in funeral service in 

1963, left the industry in 1968, and returned as the owner of Angeleno in 1997. He currently 

owns and operates six funeral establishments through Angeleno. Mr. Hawkins is joined in the 

Angeleno business by Vice President/CFO/Area Manager, Andrew Hawkins. Mr. Andrew 

Hawkins was first employed by Angeleno in 2003. He is a licensed funeral director and location 

manager who is responsible at the executive level for the finances of the company, human 
PUBLIC VERSION 

resources, compliance, and business strategy including merger and acquisition activity. Messers. 

Hawkins and Hawkins are joined by Area Manager/Location Manager, Jared Trexel, who was 

frrst employed in the funeral industry in 1963 and has over 50 years of experience. The majority 

of Mr. Trexel's experience is at the area manager level: previously with SCI and, since 1999, 

with Angeleno. 

In addition to this executive-level team, Angeleno intends to 

ill. The Proposed Divestiture Agreement Will Achieve the Purposes of the Decision and 

Order and Result in No Harm to Competition 

The proposed divestiture of the Lancaster Divestiture Assets, as embodied in the 

ASA, will achieve the purposes of the Decision and Order. Angeleno is an experienced operator 

of funeral homes, with a proven track record of successfully operating and enhancing the funeral 

homes that it has acquired in the past. Angeleno enjoys a strong financial position that will 

enable it to complete this acquisition, continue the operation of the Lancaster Divestiture Assets 

and enhance their competitiveness in the market for funeral and cremation services. Combining 

the Lancaster Divestiture Assets with Angeleno's experience and financial wherewithal will 

ensure that the objectives of the Commission's Decision and Order will be realized. 

The proposed divestiture will result in no harm to competition. Angeleno 

currently owns and operates the following six funeral homes: 
PUBLIC VERSION 

1. Reardon Simi Valley Funeral Home, 2636 Sycamore Dr., Simi Valley, CA 

93065 

2. Crawford Mortuary, 8717 Tampa Ave., Northridge, CA 91324 

3. Angeleno Mortuary, 5948 Van Nuys Blvd., Van Nuys, CA 91401 

4. Angeleno Valley Mortuary, 5423 Tujunga Ave., North Hollywood, CA 

91601 

5. Ingold Chapel, 8277 Juniper Ave., Fontana, CA 92335-3499 

6. Lorenzen Angeleno Mortuary, 18558 Sherman Way, Reseda, CA 91335 

Each of these funeral homes is approximately 50 miles or more away from both Halley-OlsenMurphy and Antelope Valley Cremation Service. Accordingly, there is no competitive 

overlap between the six funeral homes currently owned by Angeleno and the Lancaster 

Divestiture Assets under consideration in this petition. 

In sum, the proposed divestiture will remedy any alleged anticompetitive effects 

that could result in Lancaster, California, from SCI's acquisition of Stewart. The ASA will 

achieve the Commission's stated purposes of ensuring the continued use of the Lancaster 

Divestiture Assets in the same business in which they were engaged at the time of the 

announcement of the Acquisition and remedying the lessening of competition as alleged in the 

Commission's Complaint. 

[REST OF PAGE INTENTIONALLY BLANK] 
PUBLIC VERSION 

Conclusion 

For the foregoing reasons, Respondents respectfully request that the 

Commission approve the proposed divestiture of the Lancaster Divestiture Assets to 

Angeleno Mortuaries, Inc., as embodied in the ASA, as soon as practicable after expiration 

of the public comment period. 

Respectfully submitted, 

Amanda L. Wait 

Hunton & Williams LLP 

2200 Pennsylvania Ave, NW 

Washington, D.C. 20037 

(202) 955-1502 

Counsel for Respondents 

Dated: _Lrrqb::ur~.~~a4.>"(~7K=O.-.r,-'z~o::..~.t ...... 'i ____ _ 
PUBLIC VERSION 

CERTiflCATIONOFSERVICECQRPORATION INTERNATIONAL 

The (acts and information :related in the ~ote~oin~ Petition. insofatas ·they pertaJn to Service 

Corpora~ion International, :its subsidiaries" a.nd· its assets, are, to,the best of my- knowledge. 

true, corr®t~.and complete. 

Pursuant tQ' · . • · C. § 1746.1 certify undetp.emi(ty of perjury under th~ laws ~fthe t.inlred S~tes of m_erigc,rt t,theforegoing islrue·and correct_. 
PUBLIC VERSION 

CERTIFICATION OF ANGELENO MORTIJARIES. INC 

The facts and information related in the foregoing Petition, insofar as they pertain to 

Angeleno Mortuaries, Inc., their subsidiaries, and their assets, are, to the best of my 

knowledge, true, correct, and complete. 

Pursuant to 28 U.S.C. § 1746, I certify under penalty ofpeJjury under the laws of the United 7Jlli tlw :orego~ ~ ~e IDd oorrm 

Founder/President/Funeral Director 

Angeleno Mortuaries, Inc. 

42983.000035 EMF_ US 492S08S7vS 

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CONFIDENTIAL 

EXHIBIT A 
CONFIDENTIAL 

EXHIBITB