Judge rules sugar company merger legal in case involving United Sugars – Agweek

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WILMINGTON, Delaware – A federal judge has ruled that the merger between sugar companies would not violate antitrust laws, a decision impacting sugar beet cooperatives in the Red River Valley.

On Friday, September 23, U.S. District Judge Maryellen Noreika of Delaware ruled in favor of United States Sugar Corporation in its bid to acquire Imperial Sugar Company.

The Justice Department was suing to end the deal, arguing that consolidation of the sugar industry would be bad for consumers, especially those in the southeastern United States, where United States Sugar and Imperial refine cane sugar.

Minnesota-based United Sugars Corp was also named in the lawsuit. United Sugars is a marketing partnership that includes United States Sugar, as well as three sugar beet cooperatives: American Crystal Sugar, based in Moorhead, Minnesota; Minn-Dak Farmers Co-op, based in Wahpeton, North Dakota; and Wyoming Sugar.

The US Sugar purchase includes a sugar refinery near the port city of Savannah, Georgia. US Sugar said it would invest in the refinery, making it and the whole company more efficient. Lawyers for US Sugar argued that by acquiring Imperial’s retail brands, it would be able to offer products it currently cannot manufacture at its Florida refinery, including brown sugar and powder, and various sizes of bagged products.

“The people of US Sugar are thrilled that today’s court ruling allows our acquisition of Imperial Sugar to proceed as planned: allowing us to increase our sugar production, improve the local economy of Georgia for the benefit of our employees and customers.

The judge’s decision was not immediately made public to protect confidential business information. They gave the parties until September 29, 2022 to provide a redacted version of the decision to be made public.

Lawyers for both sides presented their arguments during a four-day trial in April. The judge then asked the lawyers to file briefs in support of their cases; these were filed at the end of May.

Imperial Sugar is currently owned by Louis Dreyfus, an international agribusiness company based in the Netherlands. For its case, the Justice Department cited an Imperial analysis describing US Sugar as a “close competitor” and that the merger was clearly illegal. He added that “acquiring even a less ‘efficient’ competitor can still cause harm.”

The Justice Department also described competitors in the sugar industry as having “comfortable” relationships.

US Sugar announced it would buy Imperial in March 2021. The Department of Justice filed its lawsuit in fall 2021.

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