FTC Clears Way for Thrify to Buy PayLess
The Federal Trade Commission on Thursday said it has settled antitrust charges against TCH Corp., the owner of Los Angeles-based Thrifty Drug Stores, removing the only regulatory barrier to TCH’s proposed $1.16-billion purchase of Kmart Corp.’s PayLess drugstore chain.
The FTC had opposed the acquisition, contending that the merger would create a company that could control the drugstore market in five small communities in California, Washington and Oregon. TCH also owns the Bi-Mart drugstore chain, which operates 41 stores in Oregon.
The FTC said Thrifty, Bi-Mart or PayLess dominate the five small markets and that competitors would not likely enter those communities after the two chains merged.
Under the settlement, TCH has agreed to sell five stores in those communities within a year after the deal is completed. TCH and its parent, Green Equity Investors, said they will sell Thrifty stores in the Central California communities of Bishop and Taft, as well as a store in Mt. Shasta in the northern part of the state.
TCH will also sell a Bi-Mart store in Florence, Ore., and a PayLess store in Ellensburg, Wash.
Thrifty has 497 stores--all in California. PayLess, based in Wilsonville, Ore., has 578 stores in 12 western states.
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