[Federal Register Volume 60, Number 50 (Wednesday, March 15, 1995)]
[Notices]
[Pages 13993-13998]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-6343]



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FEDERAL TRADE COMMISSION
[File No. 941 0130]


Schwegmann Giant Super Markets, Inc.; Proposed Consent Agreement 
With Analysis to Aid Public Comment

AGENCY: Federal Trade Commission.

[[Page 13994]] ACTION: Proposed consent agreement.

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SUMMARY: In settlement of alleged violations of federal law prohibiting 
unfair acts and practices and unfair methods of competition--in 
connection with Schwegmann's proposed acquisition of supermarkets 
currently owned by National Holdings, Inc.--this consent agreement, 
accepted subject to final Commission approval, would require, among 
other things, the Louisiana-based corporation to divest seven stores in 
the New Orleans area to Commission-approved purchasers, and would 
require the respondent, for ten years, to obtain Commission approval 
before acquiring an interest in a supermarket, or another entity that 
operates a supermarket, in the relevant area.

DATES: Comments should be received on or before May 15, 1995.
ADDRESSES: Comments should be directed to: FTC/Office of the Secretary, 
Room 159, 6th St. and Pa. Ave., NW., Washington, DC 20580.

FOR FURTHER INFORMATION CONTACT:
Ronald Rowe, FTC/S-2105, Washington, DC 20580. (202) 326-2610.

SUPPLEMENTARY INFORMATION: Pursuant to Section 6(f) of the Federal 
Trade Commission Act, 38 Stat. 721, 15 U.S.C. 46 and Sec. 2.34 of the 
Commission's Rules of Practice (16 CFR 2.34), notice is hereby given 
that the following consent agreement containing a consent order to 
cease and desist, having been filed with and accepted, subject to final 
approval, by the Commission, has been placed on the public record for a 
period of sixty (60) days. Public comment is invited. Such comments or 
views will be considered by the Commission and will be available for 
inspection and copying at its principal office in accordance with 
Sec. 4.9(b)(6)(ii) of the Commission's Rules of Practice (16 CFR 
4.9(b)(6)(ii)).

Agreement Containing Consent Order

    The Federal Trade Commission (``Commission'') having initiated an 
investigation of Schwegmann Giant Super Markets, Inc.'s 
(``Schwegmann'') proposed acquisition of certain assets of National 
Holdings, Inc. and certain affiliates (``National''), and it now 
appearing that Schwegmann, hereinafter sometimes referred to as 
``proposed respondent,'' is willing to enter into an agreement 
containing an Order to divest certain assets and to cease and desist 
from certain acts, and providing for other relief.
    It is hereby agreed by and among proposed respondent, its duly 
authorized officers and attorneys, and counsel for the Commission that:
    1. Proposed respondent Schwegmann Giant Super Markets, Inc. is a 
corporation organized, existing, and doing business under and by virtue 
of the laws of the State of Louisiana, with its office and principal 
place of business located at 5300 Old Gentilly Road, New Orleans, 
Louisiana 70126.
    2. Proposed respondent admits all the jurisdictional facts set 
forth in the draft of complaint.
    3. Proposed respondent waives:
    a. Any further procedural steps;
    b. The requirement that the Commission's decision contain a 
statement of findings of fact and conclusions of law;
    c. All rights to seek judicial review or otherwise to challenge or 
contest the validity of the Order entered pursuant to this agreement; 
and
    d. Any claim under the Equal Access to Justice Act.
    4. This agreement shall not become part of the public record of the 
proceeding unless and until it is accepted by the Commission. If this 
agreement is accepted by the Commission it, together with the draft of 
complaint contemplated thereby, will be placed on the public record for 
a period of sixty (60) days and information in respect thereto publicly 
released. The Commission thereafter may either withdraw its acceptance 
of this agreement and so notify the proposed respondent, in which event 
it will take such action as it may consider appropriate, or issue and 
serve its complaint (in such form as the circumstances may require) and 
decision, in disposition of the proceeding.
    5. This agreement is for settlement purposes only and does not 
constitute an admission by proposed respondent that the law has been 
violated as alleged in the draft of the complaint, or that the facts as 
alleged in the draft complaint, other than jurisdictional facts, are 
true.
    6. This agreement contemplates that, if it is accepted by the 
Commission, and if such acceptance is not subsequently withdrawn by the 
Commission pursuant to the provisions of Sec. 2.34 of the Commission's 
Rules, the Commission may, without further notice to the proposed 
respondent, (1) issue its complaint corresponding in form and substance 
with the draft of the complaint and its decision containing the 
following Order to divest and to cease and desist in disposition of the 
proceeding, and (2) make information public with respect thereto. When 
so entered, the Order shall have the same force and effect and may be 
altered, modified, or set aside in the same time provided by statute 
for other orders. The Order shall become final upon service. Delivery 
by the United States Postal Service of the complaint and decision 
containing the agreed-to Order to proposed respondent's address as 
stated in this Agreement, to the attention of the officer signing this 
agreement, shall constitute service. Proposed respondent waives any 
right it may have to any other manner of service. The complaint may be 
used in construing the terms of the Order, and no agreement, 
understanding, representation, or interpretation not contained in the 
Order or the Agreement may be used to vary or contradict the terms of 
the Order.
    7. Proposed respondent has read the proposed complaint and Order 
contemplated hereby. Proposed respondent understands that once the 
Order has been issued, it will be required to file verified written 
reports showing that it has fully complied with the Order. Proposed 
respondent further understands that it may be liable for civil 
penalties in the amount provided by law for each violation of the Order 
after it becomes final.

Order

I

    It is ordered that, as used in this Order, the following 
definitions shall apply:
    A. Respondent or Schwegmann means John F. Schwegmann and Schwegmann 
Giant Super Markets, Inc., its predecessors, subsidiaries, divisions, 
and groups and affiliates controlled by Schwegmann Giant Super Markets, 
Inc., their successors and assigns, and their directors, officers, 
employees, agents, and representatives.
    B. Assets to be divested means the supermarket assets described in 
Paragraph II.A. of this Order.
    C. Commission means the Federal Trade Commission.
    D. Supermarket  means a full-line retail grocery store that carries 
a wide variety of food and grocery items in particular product 
categories, including bread and dairy products; refrigerated and frozen 
food and beverage products; fresh and prepared meats and poultry; 
produce, including fresh fruits and vegetables; shelf-stable food and 
beverage products, including canned and other types of packaged 
products; staple foodstuffs, which may include salt, sugar, flour, 
sauces, spices, coffee, and tea; and other grocery products, including 
nonfood items such as soaps, detergents, paper goods, other household 
products, and health and beauty aids. [[Page 13995]] 
    E. New Orleans metro area means the area consisting of Jefferson, 
Orleans, and St. Bernard parishes in Louisiana.

II

    It is further ordered that:
    A. Respondent shall divest, absolutely and in good faith, within 
twelve months from the date this Order becomes final:

1. That Stanley supermarket located at 315 E. Judge Perez Drive (store 
No. 79), Chalmette, LA;
2. Canal Villere supermarket located at 4726 Paris Avenue (store No. 
24), New Orleans, LA;
3. Canal Villere supermarket located at 2125 Caton Street (store No. 
25), New Orleans, LA;
4. That Stanley supermarket located at 4223 Chef Menteur Highway (store 
No. 8), New Orleans, LA;
5. That Stanley supermarket located at 9319 Jefferson Highway (store 
No. 33), River Ridge, LA;
6. Canal Villere supermarket located at 5245 Veterans Memorial 
Boulevard (store No. 93), Metairie, LA; and
7. Canal Villere supermarket located at 135 Robert E. Lee Boulevard 
(store No. 83), New Orleans, LA.

    The assets to be divested shall include the supermarket business 
operated, and all assets, leases, properties, business and goodwill, 
tangible and intangible, utilized in the supermarket operations at the 
locations listed above, but shall not include those assets consisting 
of or pertaining to any Schwegmann or National trade names, trade 
dress, trade marks, service marks, computer software, vehicles and 
other assets except fixtures also used or to be used by respondent at 
locations other than those listed above in connection with the 
Schwegmann or National business operations.
    B. Respondent shall divest the assets to be divested only to an 
acquirer or acquirers that receive the prior approval of the Commission 
and only in a manner that receives the prior approval of the 
Commission. The purpose of the divestiture is to ensure the 
continuation of the assets to be divested as ongoing viable enterprises 
engaged in the supermarket business and to remedy the lessening of 
competition resulting from the acquisition alleged in the Commission's 
complaint.
    C. Pending divestiture of the assets to be divested, respondent 
shall take such actions as are necessary to maintain the viability, 
competitiveness, and marketability of the assets to be divested to 
comply with Paragraphs II and III of this Order and to prevent the 
destruction, removal, wasting, deterioration, or impairment of the 
assets to be divested except in the ordinary course of business and 
except for ordinary wear and tear.
    D. Respondent shall comply with all the terms of the Asset 
Maintenance Agreement attached to this Order and made a part hereof as 
Appendix I. The Asset Maintenance Agreement shall continue in effect 
until such time as all assets to be divested have been divested as 
required by this Order.

III

    It is further ordered that:
    A. If respondent has not divested, absolutely and in good faith and 
with the Commission's prior approval, the assets to be divested within 
twelve months from the date this Order becomes final, the Commission 
may appoint a trustee to divest any of the assets to be divested. In 
the event that the Commission or the Attorney General brings an action 
pursuant to section 5(l) of the Federal Trade Commission Act, 15 U.S.C. 
45(l), or any other statute enforced by the Commission, respondent 
shall consent to the appointment of a trustee in such action. Neither 
the appointment of a trustee nor a decision not to appoint a trustee 
under this Paragraph shall preclude the Commission or the Attorney 
General from seeking civil penalties or any other relief available to 
it, including a court-appointed trustee, pursuant to Sec. 5(l) of the 
Federal Trade Commission, for any failure by the respondent to comply 
with this Order.
    B. If a trustee is appointed by the Commission or a court pursuant 
to Paragraph III.A. of this Order, respondent shall consent to the 
following terms and conditions regarding the trustee's powers, duties, 
authority, and responsibilities:
    1. The Commission shall select the trustee, subject to the consent 
of respondent, which consent shall not be unreasonably withheld. The 
trustee shall be a person with experience and expertise in acquisitions 
and divestitures. If respondent has not opposed, in writing, including 
the reasons for opposing, the selection of any proposed trustee within 
ten (10) days after written notice by the staff of the Commission to 
respondent of the identity of any proposed trustee, respondent shall be 
deemed to have consented to the selection of the proposed trustee.
    2. Subject to the prior approval of the Commission, the trustee 
shall have the exclusive power and authority to divest the assets to be 
divested.
    3. Within ten (10) days after appointment of the trustee, 
respondent shall execute a trust agreement that, subject to the prior 
approval of the Commission and, in the case of a court-appointed 
trustee, of the court, transfers to the trustee all rights and powers 
necessary to permit the trustee to effect the divestitures required by 
this Order.
    4. The trustee shall have twelve (12) months from the date the 
Commission or court approves the trust agreement described in Paragraph 
III. B. 3. to accomplish the divestitures, which shall be subject to 
the prior approval of the Commission. If, however, at the end of the 
twelve-month period, the trustee has submitted a plan of divestiture or 
believes that divestiture can be achieved within a reasonable time, the 
divestiture period may be extended by the Commission, or, in the case 
of a court-appointed trustee, by the court; provided, however, the 
Commission may extend this 12-month period only one (1) time for one 
(1) year.
    5. The trustee shall have full and complete access to the 
personnel, books, records, and facilities related to the assets to be 
divested or to any other relevant information, as the trustee may 
request. Respondent shall develop such financial or other information 
as such trustee may reasonably request and shall cooperate with the 
trustee. Respondent shall take no action to interfere with or impede 
the trustee's accomplishment of the divestitures. Any delays in 
divestiture caused by respondent shall extend the time for divestiture 
under this Paragraph in an amount equal to the delay, as determined by 
the Commission or, for a court-appointed trustee, by the court.
    6. The trustee shall use his or her best efforts to negotiate the 
most favorable price and terms available in each contract that is 
submitted to the Commission, subject to respondent's absolute and 
unconditional obligation to divest at no minimum price. The 
divestitures shall be made in the manner and to the acquirer or 
acquirers as set out in Paragraph II of this Order; provided, however, 
if the trustee receives bona fide offers for an asset to be divested 
from more than one acquiring entity, and if the Commission determines 
to approve more than one such acquiring entity, the trustee shall 
divest such asset to the acquiring entity or entities selected by 
respondent from among those approved by the Commission.
    7. The trustee shall serve, without bond or other security, at the 
cost and expense of respondent, on such reasonable and customary terms 
and conditions as the Commission or a court may set. The trustee shall 
have the authority to employ, at the cost and expense of respondent, 
such [[Page 13996]] consultants, accountants, attorneys, investment 
bankers, business brokers, appraisers, and other representatives and 
assistants as are necessary to carry out the trustee's duties and 
responsibilities. The trustee shall account for all monies derived from 
the sale and all expenses incurred. After approval by the Commission 
and, in the case of a court-appointed trustee, by the court, of the 
account of the trustee, including fees for his or his services, all 
remaining monies shall be paid at the direction of the respondent, and 
the trustee's power shall be terminated. The trustee's compensation 
shall be based at least in significant part on a commission arrangement 
contingent on the trustee's divesting the assets to be divested to 
satisfy Paragraph II of this Order.
    8. Respondent shall indemnify the trustee and hold the trustee 
harmless against any losses, claims, damages, liabilities, or expenses 
arising out of, or in connection with, the performance of the trustee's 
duties, including all reasonable fees of counsel and other expenses 
incurred in connection with the preparation for, or defense of any 
claim, whether or not resulting in any liability, except to the extent 
that such liabilities, losses, damages, claims, or expenses result from 
misfeasance, gross negligence, willful or wanton acts, or bad faith by 
the trustee.
    9. If the trustee ceases to act or fails to act diligently, a 
substitute trustee shall be appointed in the same manner as provided in 
Paragraph III.A. of this Order.
    10. The Commission or, in the case of a court-appointed trustee, 
the court, may on its own initiative or at the request of the trustee 
issue such additional Orders or directions as may be necessary or 
appropriate to accomplish the divestiture required by this Order.
    11. The trustee shall have no obligation or authority to operate or 
maintain the assets to be divested.
    12. The trustee shall report in writing to respondent and the 
Commission every sixty (60) days concerning the trustee's efforts to 
accomplish divestiture.

IV

    It is further ordered that, for a period of ten (10) years from the 
date this Order becomes final, respondent shall not, without the prior 
approval of the Commission, directly or indirectly, through 
subsidiaries, partnerships, or otherwise:
    A. Acquire any ownership or leasehold interest in any facility that 
has operated as a supermarket within six (6) months of the date of such 
proposed acquisition in the New Orleans metro area.
    B. Acquire any stock, share capital, equity, or other interest in 
any entity that owns any interest in or operates any supermarket or 
owned any interest in or operated any supermarket within six (6) months 
of such proposed acquisition in the New Orleans metro area.
    Provided, however, that these prohibitions shall not apply to the 
construction of new facilities by respondent or the acquisition of or 
leasing of a facility that has not operated as a supermarket within six 
(6) months of respondent's offer to purchase or lease.

V

    It is further ordered that, for a period of ten (10) years 
commencing on the date this Order becomes final:
    A. Respondent shall neither enter into nor enforce any agreement 
that restricts the ability of any person (as defined in Section 1(a) of 
the Clayton Act, 15 U.S.C. 12(a)) acquiring any supermarket owned or 
operated by respondent, any leasehold interest in any supermarket, or 
any interest in that portion of any retail location used as a 
supermarket on or after January 1, 1995 in the New Orleans metro area 
to operate a supermarket at that site; provided however, that nothing 
in this Paragraph shall prevent respondent from entering into or 
enforcing any agreement requiring its approval of any sublease, 
assignment, or change in occupancy, which approval shall not be 
unreasonably withheld; provided further that use of a site for the 
operation of a supermarket shall not be a basis for withholding such 
approval.
    B. Respondent shall not remove any equipment for a supermarket 
owned or operated by respondent in the New Orleans metro area prior to 
a sale, sublease, assignment, or change in occupancy, except for 
replacement or relocation of such equipment in or to any other 
supermarket owned or operated by respondent in the ordinary course of 
business, or as part of any negotiation for a sale, sublease, 
assignment, or change in occupancy of such supermarket.

VI

    It is further ordered that:
    A. Within sixty (60) days after the date this Order becomes final 
and every sixty (60) days thereafter until respondent has fully 
complied with the provisions of Paragraphs II or III of this Order, 
respondent shall submit to the Commission verified written reports 
setting forth in detail the manner and form in which it intends to 
comply, is complying, and has complied with Paragraphs II and III of 
this Order. Respondent shall include in its compliance reports, among 
other things that are required from time to time, a full description of 
the efforts being made to comply with Paragraphs II and III of the 
Order, including a description of all substantive contacts or 
negotiations for the divestiture and the identity of all parties 
contacted. Respondent shall include in its compliance reports copies of 
all written communications to and from such parties, all internal 
memoranda, and all reports and recommendations concerning divestiture.
    B. One year (1) from the date this Order becomes final, annually 
for the next nine (9) years on the anniversary of the date this Order 
becomes final, and at other times as the Commission may require, 
respondent shall file verified written reports with the Commission 
setting forth in detail the manner and form in which it has complied 
and is complying with this Order.

VII

    It is further ordered that respondent shall notify the Commission 
at least thirty (30) days prior to any proposed change in respondent 
such as dissolution, assignment, sale resulting in the emergence of a 
successor corporation, or the creation or dissolution of subsidiaries 
or any other change in respondent that may affect compliance 
obligations arising out of the Order.

VIII

    It is further ordered that, for the purpose of determining or 
securing compliance with this Order, respondent shall permit any duly 
authorized representative of the Commission:
    A. Upon five days' written notice to respondent, access, during 
office hours and in the presence of counsel for respondent, to inspect 
and copy all books, ledgers, accounts, correspondence, memoranda and 
other records and documents in the possession or under the control of 
respondent relating to any matters contained in this Order; and
    B. Upon five days' written notice to respondent and without 
restraint or interference from it, to interview respondent or officers, 
directors, or employees of respondent in the presence of counsel for 
respondent relating to any matters contained in this Order.
Asset Maintenance Agreement

    This Asset Maintenance Agreement (``Agreement'') is by and between 
[[Page 13997]] Schwegmann Giant Super Markets, Inc. (``Schwegmann''), a 
corporation organized under the laws of the State of Louisiana, with 
its principal offices located at 5300 Old Gentilly Road, New Orleans, 
Louisiana 70126, and the Federal Trade Commission (``Commission''), an 
independent agency of the United States Government, established under 
the Federal Trade Commission Act of 1914, 15 U.S.C. Sec. 41, et seq. 
(collectively ``the Parties'').

Premises

    Whereas, Schwegmann, pursuant to an agreement dated November 23, 
1994, agreed to purchase certain assets of National Holdings, Inc. and 
certain affiliates (hereinafter ``Acquisition''); and
    Whereas, the Commission is now investigating the Acquisition to 
determine if it would violate any of the statutes enforced by the 
Commission; and
    Whereas, if the Commission accepts the attached Agreement 
Containing Consent Order, the Commission is required to place it on the 
public record for a period of sixty (60) days for public comment and 
may subsequently withdraw such acceptance pursuant to the provisions of 
Secs. 2.34 of the Commission's Rules; and
    Whereas, the Commission is concerned that if an agreement is not 
reached preserving the status quo ante of the assets to be divested as 
described in II.A. of the attached Agreement Containing Consent Order 
(``Assets'') during the period prior to their divestitures, when those 
assets will be in the hands of Schwegmann, that any divestiture 
resulting from any administrative proceeding challenging the legality 
of the Acquisition might not be possible, or might produce a less than 
effective remedy; and
    Whereas, the Commission is concerned that prior to divestiture to 
the acquirer, it may be necessary to preserve the continued viability 
and competitiveness of the Assets; and
    Whereas, the purpose of this Agreement and of the Consent Order is 
to preserve the Assets pending the divestiture to the acquirer approved 
by the Federal Trade Commission under the terms of the Order, in order 
to remedy any anticompetitive effects of the Acquisition; and
    Whereas, Schwegmann entering into this Agreement shall in no way be 
construed as an admission by Schwegmann that the Acquisition is 
illegal; and
    Whereas, Schwegmann understands that no act or transaction 
contemplated by this Agreement shall be deemed immune or exempt from 
the provisions of the antitrust laws, or the Federal Trade Commission 
Act by reason of anything contained in this Agreement;
    Now, therefore, in consideration of the Commission's agreement 
that, unless the Commission determines to reject the Consent Order, it 
will not seek further relief from the parties with respect to the 
Acquisition, except that the Commission may exercise any and all rights 
to enforce this Agreement and the Consent Order annexed hereto and made 
a part thereof, and, in the event the required divestiture is not 
accomplished, to appoint a trustee to seek divestiture of the Assets, 
the Parties agree as follows:

Terms of Agreement

    1. Schwegmann agrees to execute, and upon its issuance to be bound 
by, the attached Consent Order. The Parties further agree that each 
term defined in the attached Consent Order shall have the same meaning 
in this Agreement.
    2. Unless the commission brings an action to seek to enjoin the 
proposed Acquisition pursuant to Section 13(b) of the Federal Trade 
Commission Act, 15. U.S.C. Sec. 53(b), and obtains a temporary 
restraining order or preliminary injunction blocking the proposed 
Acquisition, Schwegmann will be free to close the Acquisition after 
11:59 p.m., March 8, 1995.
    3. Schwegmann agrees that from the date this Agreement is accepted 
until the earliest of the dates listed in subparagraphs 3.a--3.b it 
will comply with the provisions of this Agreement:
    a. Three business days after the Commission withdraws its 
acceptance of the Consent Order pursuant to the provisions of Sec. 2.34 
of the Commission's Rules; or
    b. On the day the divestitute set out in the Consent Order has been 
completed.
    4. From the time Schwegmann acquires the Assets until the earliest 
of the dates listed in subparagraphs 3.a--3.b, Schwegmann shall 
maintain the viability, competitiveness and marketability of the 
Assets, and shall not cause the wasting or deterioration of the Assets, 
nor shall it sell, transfer, encumber or otherwise impair their 
marketability or viability.
    5. Should the Commission seek in any proceeding to compel 
Schwegmann to divest itself of the Assets or to seek any other 
injunctive or equitable relief, Schwegmann shall not raise any 
objection based upon the expiration of the applicable Hart-Scott-Rodino 
Antitrust Improvements Act waiting period or the fact that the 
Commission has not sought to enjoin the Acquisition. Schwegmann also 
waives all rights to contest the validity of this Agreement.
    6. For the purpose of determining or securing compliance with this 
Agreement, subject to any legally recognized privilege, and upon 
written request with reasonable notice to Schwegmann to its principal 
offices, Schwegmann shall permit any duly authorized representative or 
representatives of the Commission:
    a. Access during the office hours of Schwegmann, in the presence of 
counsel for Schwegmann, to inspect and copy all books, ledgers, 
accounts, correspondence, memoranda and other records and documents in 
the possession or under the control of Schwegmann relating to 
compliance with this Agreement; and
    Without restraint or interference from them, to interview officers 
or employees of Schwegmann, who may have counsel present, regarding any 
such matters.
    7. This Agreement shall not be binding until approved by the 
Commission.
Analysis of Proposed Consent Order to Aid Public Comment

    The Federal Trade Commission (``Commission'') has accepted for 
public comment from Schwegmann Giant Super Markets, Inc. 
(``Schwegmann'') an agreement containing a proposed consent order. The 
agreement is designed to remedy anticompetitive effects stemming from 
Schwegmann's acquisition of a number of supermarkets owned by National 
Holdings, Inc. and certain affiliates (``National'').
    The agreement has been placed on the public record for sixty (60) 
days for receipt of comments by interested persons. Comments received 
during this period will become part of the public record. After sixty 
days, the Commission will again review the agreement and the comments 
received and will decide whether it should withdraw from the agreement 
or make final the agreement's proposed order.
    The Commission's draft complaint charges that on or about November 
23, 1994, Schwegmann agreed to acquire National's supermarkets located 
in Louisiana, Mississippi, and Alabama. The Commission has reason to 
believe that the acquisition, as well as the agreement to enter into 
the acquisition, would substantially lessen competition in violation of 
Section 7 of the Clayton Act, as amended, 15 U.S.C. 18, and Section 5 
of the FTC Act, as amended, 15 U.S.C. 45.
    According to the draft complaint, Schwegmann and National are 
direct competitors for the retail sale of food [[Page 13998]] and 
grocery items in supermarkets, or narrower product markets contained 
therein, in the ``New Orleans metro area,'' which consists of the 
parishes of Orleans, Jefferson, and St. Bernard, or narrower geographic 
markets contained therein. According to the draft complaints, the 
relevant markets are highly concentrated and entry is difficult or 
unlikely. Schwegmann's acquisition of National may reduce competition 
in these markets by eliminating the direct competition between 
Schwegmann and National, by increasing the likelihood that Schwegmann 
will become a dominant firm, and by increasing the likelihood of 
collusive behavior among the remaining competitors.
    The agreement containing consent order attempts to remedy the 
Commission's competitive concerns about the acquisition. Under the 
terms of the proposed order, Schwegmann must divest seven supermarkets 
within twelve months, to a purchaser approved by the Commission. If 
Schwegmann fails to satisfy the divestiture provisions, the Commission 
may appoint a trustee to divest supermarkets to satisfy the terms of 
the order. The seven supermarkets to be divested are:

1. That Stanley supermarket located at 315 E. Judge Perez Drive (store 
No. 79), Chalmette, LA;
2. Canal Villere supermarket located at 4726 Paris Avenue (store No. 
24), New Orleans, LA;
3. Canal Villere supermarket located at 2125 Caton Street (store No. 
25), New Orleans, LA;
4. That Stanley supermarket located at 4223 Chef Menteur Highway (store 
No. 8), New Orleans, LA;
5. That Stanley supermarket located at 9319 Jefferson Highway (store 
No. 33), River Ridge, LA;
6. Canal Villere supermarket located at 5245 Veterans Memorial 
Boulevard (store No. 93), Metairie, LA;
7. Canal Villere supermarket located at 135 Robert E. Lee Boulevard 
(store No. 83), New Orleans, LA.

    For a period of ten years from the date the order becomes final, 
the order also prohibits Schwegmann from acquiring, without prior 
Commission approval, supermarket assets located in, or any interest 
(such as stock) in any entity that owns or operates a supermarket 
located in, the New Orleans metro area. This does not prevent 
Schwegmann from constructing new supermarket facilities on its own; nor 
does it prevent Schwegmann from leasing facilities not operated as 
supermarkets within the previous six months.
    For a period of ten years, if Schwegmann sells or leases a 
supermarket to another person, Schwegmann may not enter into or enforce 
any agreement that would restrict the ability of that person to operate 
a supermarket. In addition, subject to certain exceptions, Schwegmann 
may not remove any equipment from a supermarket it owns or operates 
prior to a sale, sublease, assignment, or change in occupancy.
    The respondent is required to provide to the Commission a report of 
compliance with the order within sixty (60) days following the date the 
order becomes final, every sixty (60) days thereafter until the 
divestitures are completed, and annually for a period of ten years.
    The purpose of this analysis is to invite public comment on the 
proposed consent order to aid the Commission in its determination of 
whether it should make final the proposed consent order contained in 
the agreement.
    This analysis is not intended to constitute an official 
interpretation of the agreement and proposed consent order, nor is it 
intended to modify the terms of the agreement and proposed consent 
order in any way.
Donald S. Clark,
Secretary.

Concurring Statement of Commissioner Mary L. Azcuenaga

Re: Schnuck Markets, Inc., File No. 941-0131; Schwegmann Giant Super 
Markets, Inc., File No. 941-0130

    The two complaints allege geographic markets comprising ``the St. 
Louis MSA, and narrower markets contained therein'' and ``metro New 
Orleans, Louisiana area, which consists of the parishes of Orleans, 
Jefferson, and St. Bernard, and marrower markets contained therein.'' 
Although I question the broad geographic markets alleged, the 
investigational record contains sufficient information to support a 
finding of reason to believe with respect to small, discrete geographic 
markets located within the broad regions alleged in the complaint, and 
the stores to be divested were selected with a view to remedying 
competitive concerns in the small, discrete markets.
    In addition, the complaints allege as the product market ``the 
retail sale of food and grocery products in supermarkets, and narrower 
markets contained therein.'' A serious argument can be made that the 
market should include sales of food and groceries in certain stores 
other than traditional supermarkets. Since the investigational record 
suggests that the concentration is high even if additional sales are 
included in the market, the issue need not be resolved at this time. 
Accordingly, I concur in the decision to accept the consent agreements 
for publication.

[FR Doc. 95-6343 Filed 3-14-95; 8:45 am]
BILLING CODE 6750-01-M