FTC Opposes Post’s Acquisition of Treehouse Private Brand Cereal Business

Late last week the Federal Trade Commission filed an administrative complaint challenging Post Holdings, Inc.’s proposed acquisition of TreeHouse Foods, Inc.’s private label ready-to-eat cereal business. Post and TreeHouse are two of only three significant manufacturers and distributors of private label ready-to-eat cereal in the United States. The acquisition would give Post more than a 60% share of an already highly concentrated market and eliminate the vigorous competition between them to serve grocers across the country. The proposed merger would remove the competitive pressure that has driven higher quality and lower priced cereals for American families.

Ready-to-eat cereals are a staple of American breakfasts. These cereals do not require any preparation before consumption. Nearly every grocer offers a selection of ready-to-eat cereals in their stores. In addition to carrying national brands of ready-to-eat cereals, many stores offer private label ready-to-eat cereals, with the retailer’s own trade name.

“Households nationwide benefit from the robust competition between Post and TreeHouse, and a merger between these companies would likely lead to higher prices and reduced quality of the store-brand cereals that consumers enjoy today,” said Ian Conner, Deputy Director of the FTC’s Bureau of Competition.

The Commission also authorized FTC staff to seek a temporary restraining order and a preliminary injunction in federal court, if necessary, to prevent the parties from consummating the merger, and to maintain the status quo pending the conclusion of the administrative proceeding.

The Commission votes to issue the administrative complaint and to authorize staff to seek a temporary restraining order and preliminary injunction were both 5-0.  The administrative trial is scheduled to begin on May 27, 2020.

Previous articleSales Soar for Waitrose Festive Private Brand Vegan Range
Next articleBed Bath & Beyond CEO Mark Tritton Makes Extensive Changes To Leadership Team
Christopher Durham is the president of My Private Brand and the co-founder of The Vertex Awards. He is a strategist, author, consultant and retailer who built brands at Delhaize-owned Food Lion, and lead strategy and brand development for Lowe’s Home Improvement. He has consulted with retailers around the world on their private brand portfolios including: Family Dollar, Petco, Staples, Office Depot, Best Buy, Metro (Canada), TLW (Taiwan) and Hola (Taiwan). Durham has published five definitive books on private brands, including his first book, Fifty2: The My Private Brand Project. In 2017, he will debut his newest book, Vanguard: Vintage Originals, a visual tour of innovation and disruption in private brand going back to the mid-1800’s. Dynamic in his presentation while down to earth and frank in his opinions, he has presented at numerous conferences, including FUSE, The Dieline Conference, Packaging that Sells, Omnishopper and PLMA’a annual trade show in Chicago. Durham lives in Charlotte, NC with his wife, Laraine, and two daughters, Olivia and Sarah.